How Much Does a Cable Box Really Cost? The Industry Would Prefer You Don't Ask (latimes.com)

The FCC chairman insists that he is driven by a market-based approach to regulation. In a story, published Tuesday, an LA Times columnist uses the simple example of set-top boxes to argue the agency has, instead, been captured by the industry it regulates. From the story: Spectrum TV and internet customers will see their rates go up again in November. Among other increases, the broadcast TV surcharge will rise to $9.95 from $8.85 a month, and the monthly fee for a set-top box will jump to $7.50 from $6.99. It was that last charge that got my attention -- and got me thinking about the economics involved. How much do cable boxes actually cost? Why do their monthly fees keep going up when the cost of similar technology, such as TVs and computers, goes down over time? Not surprisingly, my attempts to answer these questions were met with stonewalling from industry players.

Spectrum, owned by Charter Communications, the dominant pay-TV company in Southern California, clammed up real fast when I asked how much they pay for the boxes they lease to subscribers. Nor would it comment on how much cash flow the boxes generate, or why fees keep rising even as the number of residential TV subscribers dwindles (down 66,000 more in the third quarter). Dennis Johnson, a company spokesman, said only that the 7.3% higher box charge in November -- more than three times the inflation rate -- represents a "modest increase" that is "comparable or even lower than our major competitors."

Comments

This is why cord-cutting has become common

[SuperKendall]

That was one reason I stopped using Cable TV services, I could not take the recurring cost of a cheap ill-made box with a terrible UI.

I would way rather spend more one time on my own box, as I do with cable modems - at least then I haves some control over quality and will not be paying a huge amount over the lifetime of use.

I have to think that a lot of people do not like TV services gated through a crappy cable company box and that is doing a lot to increase the number of people unsubscribing from cable TV content.

We all know the truth

[bobbied]

They are making scads of cash on these things and the price goes up because they need more and more revenue because the cord cutters are killing the top line.

Personally, I use only a cable card, which runs $4/month and get up to 3 channels of TV at a time. Still this is highway robbery, Cable Cards only cost a few hundred dollars and I know they have a pile of them just sitting there and they charge enough just for service to more than pay for this.

Market-based Approach

[PPH]

So, what's the going price for an FCC chairman?

Comcast won't give a static IP without their modem

[t0qer]

Had this issue pop up recently.

A few years back customer opens shop. After 3 shitty comcrap modems, we buy our own. Comcast at the time has no issue, we have a static IP set and it's set for 3 years. FF to last week. Customer can't connect via VPN, lotta other people depending on that static IP can't connect. I call comcast and they start troubleshooting.

Apparently they changed their policy. No static IP if the customer is using their own modem. Nope, we can't have our old IP back, big FU. We have to pay $19.95@mo + $10 modem lease to get a static from them now. Never mind that this is a bonafide business account. Cable companies are worse than lawyers and politicians, and that's a pretty low bar as is.

Re:Comcast won't give a static IP without their mo

[omnichad]

Charter (Spectrum) is worse. No static IP without a business account. No customer-owned modems allowed for business accounts at all. They claim it's to "maintain the quality of their business network" as if they're using different channels or nodes for business customers.