Many of metro Atlanta Comcast customers started off the year with higher cable bills as the nation’s top cable provider raised rates for most of its TV packages.
But frustrated customers may find little options elsewhere as competitors such as DirecTV and AT&T’s U-verse are bumping up their prices as well.
Most of Comcast's packages, including the ones for basic services, digital cable and ones bundled with Internet, rose between 4 and 6 percent. DirecTV's rates also rose an average 4 percent. U-verse's packages have increased between 10 and nearly 30 percent since 2007. All of the information was supplied by the companies and customer billing notifications.
“Cable companies raise rates because they can,” said Corie Wright, an attorney with Free Press, a nonprofit advocacy group focused on media reform. “There’s very little effective competition” that could lead to stable or lower prices.
Andy Macke, Comcast’s government and community affairs vice president, said networks such as ESPN continue to increase their programming costs. Rising gas prices also have contributed to higher operational costs, which is why even the most basic of cable packages – ones that air local broadcast channels only – had a rate increase as well. Customers of Comcast's limited-basic service now pay $28.65, a 23-percent increase from the year before. Those rates have gone up 165 percent since 2007, when they were at $10.83.
One of Comcast’s packages, Digital Economy, dropped by $10. Macke also said customers who signed up for two-year packages under a promotion won’t see a rate increase until that time period ends.
“We do try to contain the rates as much as possible,” Macke said.
The average price for cable rates nationwide is $78.19, a 17 percent increase from 2008, according to figures from SNL Kagan, a national research firm.
Average prices for satellite and video packages supplied by telephone companies such as AT&T and Verizon are actually higher. Satellite rates average $86.27, a 13-percent increase from 2008. For video services from telephone companies, the average rate is $86.72, an 18-percent increase since 2008, according to SNL Kagan figures.
Meanwhile, DISH implemented a two-year price freeze in January 2011, to "provide stability to customers," a company spokesman said.
“In areas where there is competition, you might see lower costs,” said Parul Desai, policy counsel at Consumers Union, the nonprofit group that publishes the monthly magazine Consumer Reports.
“But what’s happened over the years, you have regional monopolies and the big guys don’t compete with each other.”
There's also little to no oversight to what cable and other multi-channel providers can charge customers. It's up to competition, and market forces to help set the price.
Neither the Federal Communications Commission nor state utility regulators oversee what cable companies charge. Traditionally, companies wanting to sell cable would have to strike a franchise agreement with city and county governments, though most states including Georgia changed the law allowing for providers to get a statewide license instead.
Even then, only the very basic of rates would have been regulated, and that’s only in the cases of little competition. Even though Comcast is the dominant cable provider in metro Atlanta, AT&T's U-verse, DirecTV and DISH sell service as well.
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