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FCC To End Exclusive Cable For Apartments
spiffyman writes "The New York Times is reporting that on Wednesday the FCC will end exclusive contracts to provide cable service to apartment buildings. Commission Chairman Kevin J. Martin is quoted as saying that cable prices have risen 'about 93 percent in the last 10 years' and that the FCC hopes to see more competition out of this move. This is a step in the right direction. In my apartment, for example, I have (dead) outlets for one cable company but am forced to go with the higher-priced firm. Moves like this will help those who live in areas where competition — even minimal competition — exists. The article also discusses the impact this may have on low- to middle-income families, who disproportionately live in apartment complexes."
Um, not like I want to defend cable companies and their pricing, but "93% in 10 years" is to my mind an inflammatory way of saying "an average of 6.7% per year over the last 10 years." Given that overall the consumer price index has averaged about a 3% increase per year over that period, cable prices are bad, but not as bad as the quote makes it sound. Then again, entire industries (credit cards, for example) owe their existence due to people's inability to compute compounded interest, so perhaps the wording should be no surprise.
Ending these exclusive contracts is a good idea and I'm glad the FTC is doing this. The only problem is I don't see this really having an impact on Cable prices. The problem is a vast majority of people still won't have a choice since cable companies already divide up local areas.
For example the apartment I live in doesn't have an exclusive contract but the ONLY company I can get cable with is Comcast. Same thing is true at my Parent's house and they live 2000 miles away in another state. We won't see cable prices decrease until we start to see multiple cable companies competing for business in the same city. The large cable operators would rather just divide up the country into local monopolies than actually compete on price.
My parents service is another good example of how these companies work. Their cable company Time Warner decided to trade their city for another city with Comcast. Out went their former internet service and in came Comcast with the exact same package only $20 more, with P2P throttling. Their city doesn't have an exclusive franchise agreement with any cable company, and any company would be welcome to come in and establish a second franchise. No one wants to bother since they can all make more being little local monopolies sucking their customers dry.
What are low-income families doing with cable anyway? I don't mean to sound like Scrooge, but it pisses me off when an elementary school kid shows up at school without a coat in the dead of winter because his parents "can't afford one," but they sure can afford to pay the cable bill every month. /rant
My grandmother used anecdotal evidence all the time, and she lived to be 120 years old.