Slashdot Mirror
AT&T, Dish, Comcast All Raising Cable TV Rates To Counter Cord-Cutting (dallasnews.com)
AT&T's DirecTV, Dish, and Comcast are all planning to raise their rates again in the new year, "a move that could boost revenue but risks alienating subscribers who have been ditching their traditional TV subscriptions in record numbers," reports Dallas News. From the report: Cable and satellite providers are hoping to squeeze more money from consumers who remain loyal to their packages with hundreds of channels, Philip Cusick, a JPMorgan Chase & Co. analyst, said in a note this week, even though "this strategy could accelerate video sub declines." The latest price increases come as cord-cutting accelerates. In the third quarter, the TV industry saw its largest ever rate of decline, with subscribers shrinking by 3.7 percent, according to MoffettNathanson LLC. Consumers are dropping traditional TV for lower-cost online options like Netflix Inc. and slimmer TV options from Hulu and YouTube.
DirecTV is raising rates on all English-language video packages by $3 to $8 a month while hiking fees for regional sports networks by $1 to $1.90 in most markets. Dish said it's increasing prices for English-language video packages by $3 to $5 a month. Altice USA, the fourth-largest cable operator, recently raised rates by 3 percent on Optimum subscribers. Comcast, the largest U.S. cable company, is raising its fee for regional sports networks by $1.50 on average and its fee for broadcast channels by $2 a month, according to Cusick. Charter Communications Inc., the second-largest U.S. cable provider, recently boosted its monthly fee for a set-top box by about 50 cents and its broadcast channel fee by about $1. Charter operates as Spectrum in Dallas-Fort Worth.
DirecTV is raising rates on all English-language video packages by $3 to $8 a month while hiking fees for regional sports networks by $1 to $1.90 in most markets. Dish said it's increasing prices for English-language video packages by $3 to $5 a month. Altice USA, the fourth-largest cable operator, recently raised rates by 3 percent on Optimum subscribers. Comcast, the largest U.S. cable company, is raising its fee for regional sports networks by $1.50 on average and its fee for broadcast channels by $2 a month, according to Cusick. Charter Communications Inc., the second-largest U.S. cable provider, recently boosted its monthly fee for a set-top box by about 50 cents and its broadcast channel fee by about $1. Charter operates as Spectrum in Dallas-Fort Worth.
A shame, but if they jack up my costs, I'll just pull the plug and get free HDTV from my HDTV antenna at 1080p resolution.
-- Tigger warning: This post may contain tiggers! --
Great, this is excellent for short-term revenue, which is all that matters.
Next, more commercials should be added.
Selling more commercials will increase revenue
Revenue will be increased with more commercials
Increasing commercials will increase revenue.
the ratio is too small.
5 mins of content, should require 2 min of commercials.
And the same commercial should be repeated at least twice.
the rental fees should also be increased.
also , pay per view fees should be increased.
people should be required to rent the cable box, the cable card, and the remote control, and the batteries for the remote. only authorized batteries should be able to be used.
heck, the tv should be rented as well, and should have a camera installed to ensure only authorized people watch, to prevent sharing.
Shouldn't they be raising Internet rates instead, since Internet service is needed by cord-cutters too? The other fees are avoided by cancelling cable.
Exec: Customers are leaving... why?
Marketing: They don't see the value in our service!
Exec: Let's raise the prices!
Marketing: What???
Exec: It ain't cheap if it's valuable! Double the price, double the valuable!
Chewbacon
The Bible is like Wikipedia: written by a bunch of people and verifiable by questionable sources.
Has any industry ever pulled out of a dip in demand by raising costs?
This is a signal they figure they can block/degrade media streaming and get away with it, and that media properties are pulling out of the big streaming companies and that'll screw up the cord cutting value proposition.
Yes, you'd get much better internet access under communism...
Criticism of certain aspects of capitalism != advocating a switch to communism
At least you had the sense to post A.C. to avoid owning your faulty logic.
---
DRM is like antifreeze, to the MPAA/RIAA it's sweet, to the consumers it's poison.
Cable companies are increasing prices to maintain revenue growth, not to counter cord-cutting (the title is illogical), and they can do it because TV is mostly price inelastic. Consider the markets Cable companies are in:
TV - Mature, saturated, declining
Landline Internet - Mature, saturated (as far as they are concerned), declining slightly (and possibly declining significantly if 5G can provide 20-100 Mbps fixed Internet for good prices)
Landline Phone - Mature, saturated, declining
Mobile Phone - Mature, mostly saturated
No real competition; in some cases single companies have monopolies over local territory like counties; elsewhere there's a choice of just 2 companies, so an oligopoly situation where 2 choices have 100% of the market.
All those declining markets means one thing: cable companies have a hard time keeping revenue positive and keeping shareholders happy. Their solution? Increase prices on their services; in Canada in particular, they increase the price of TV and Internet every single year. They have wireless "sub brands" that charge $45 for a plan that the "premium brand" service charges $85/mo for. In short: the cable companies want to keep increasing revenue and 2% per quarter isn't good enough, so they are gouging people who won't abandon these services, and they have so little competition they can get away with it. If people want to solve this issue, I recommend making the jump to competitive services, such as online streaming, smaller Internet providers, and also writing to their elected representatives. Big Cable and Phone has a stranglehold on communication services and is doing everything to keep them priced at ridiculously high levels relative to many other markets (Europe being a perfect example). We get much less value from these companies than we should be. And without government intervention and active, vocal consumers the price of cable will continue to rise.
Cord cutting will increase until price increases stop
The very first class you take in Economics in school will explain, very simply, that increasing the price will reduce demand.
If they are trying to fight against cord cutters, then surely the correct way is to increase demand on their own services. This can be done in a number of ways, one of which is REDUCING the price. The other is to pump some money into improving the product at the current price (i.e. give people what they want, not what you want to give them).
They are basically just slitting their own throats here, and will cause more people to cord cut. Those people who can't or won't (probably the elderly) are left to suffer with crippling rates that they struggle to pay.
I suppose, however, this sort of behaviour will just lead to the company ultimately failing and going bankrupt. And for some of these companies, that can only be a good thing...
Until they jack up the Internet access costs to cover people getting just internet and subscribing to streaming services...