The Consumers Union has been putting out a red alert about plans from a number of cable operators to get in some rate increases in advance of the DTV transition, and using tier shifting to build in hidden rate increases. The FCC has now officially seconded CU’s concerns.
FCC’s Mary Diamond stated, "We agree with Consumers Union. Over the last decade average cable rates have more than doubled. And now cable companies are charging consumers more but consumers are receiving less. We have also received complaints that cable companies are moving channels to a digital-only tier and charging consumers the same monthly rate for a reduced number of channels. If consumers wish to continue watching the same channels that they were before, they must now buy a more expensive package or rent more expensive equipment. This is an unfortunate trend for families facing increasingly difficult economic times."
RBR/TVBR observation: The cable modus operandi has been under attack from a number of different angles, and the FCC of Chairman Kevin Martin has been more than willing to get into the thick of it. The FCC just referred disputes between independent programmers and MSOs to an administrative law judge after agreeing that the producers had a legitimate gripe. Martin recently tried and failed to insert Class A television stations onto cable channel lineup cards via a must-carry requirement, and Martin has been a vocal proponent of mandating a la carte channel menus. And lurking in the background are telcos, doing their level best to bring direct MVPD competition to cable everywhere they can, again with Martin greasing wheels to help them. It is safe to say that NCTA will not be sad to see a new body – any body – in the FCC Chair next year.
