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Cable Technology Feature Article

August 14, 2012

FCC: Cable TV Pricing on the Rise

By Tara Seals, TMCnet Contributor

The FCC's (News - Alert) latest report on average cable pricing is out, and it finds that the average monthly price of expanded basic cable service increased by 5.4 percent in 2010, to reach $57.46. That outstripped the overall increase of 1.6 percent in the Consumer Price Index (CPI).   

Basic cable came in at $19.33, which reflects a 7.1 percent increase. That said, rates may be going up, but operators are adding more channels. The price per channel for subscribers actually decreased in 2010 by 2.1 percent, to 57 cents per channel. 

Operators offered an average of 124 channels for expanded basic service and 44 channels for basic service. The FCC also clocked "family friendly" packages, which offer an average of 65 channels and carry an average monthly rate of $36.41.

When it comes to these family-friendly options, the power of sports programming was in evidence: While 44 percent of subscribers had the option to elect a family-friendly package, less than one percent subscribed, instead electing to take basic service or expanded basic service. 

"While this low percentage likely reflects a number of factors, the data indicate that family-friendly packages generally lack sports programming (e.g. ESPN (News - Alert)) and thus many families may not consider it to be a viable alternative to expanded basic service," the commission said in its report.

The FCC also found that price increases were actually less prominent in noncompetitive environments (communities with only one or two terrestrial TV providers and satellite market share of less than 15 percent). In those areas, the average price of expanded basic service increased by 5.2 percent, to $56.82. For what the FCC calls the "effective competition" communities, the average price increased by 5.7 percent, to $58.47. 

Meanwhile, operators in competitive environments carry more channels: the price per channel is 6.2 percent lower in effective competition communities.

Want to learn more about the latest in communications and technology? Then be sure to attend ITEXPO West 2012, taking place Oct. 2-5, in Austin, TX.  Stay in touch with everything happening at ITEXPO (News - Alert). Follow us on Twitter.

Edited by Rachel Ramsey

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