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Cable Technology Feature Article

May 19, 2014

Prices for Cable TV Grew 5% in 2013

By Gary Kim, Contributing Editor

Surveyed retail prices for the most-popular tier of cable TV service grew by five percent in 2013, while the average price per channel (a measure of wholesale price inflation) grew by two percent, according to the U.S. Federal Communications Commission.

Also, additional charges for set-top box rentals or HDTV service represent additional costs. And the reported FCC (News - Alert) figures do not include taxes and fees.

The average price of expanded basic service grew at a compound annual rate of 6.1 percent over the 18-year period from 1995-2013, the FCC also notes.

Other studies show that expanded basic prices doubled over 10 years. Cost increases were lower for “antenna TV” services, and roughly were in line with overall inflation.

The FCC analysis separately accounts for growth of other prices, such as set-top box or outlet charges, which are in addition to the posted retail prices for video service, and also do not include taxes and fees that raise the cost further.

But cable operators might argue that those rate hikes are in line with the growth of the number of channels offered and new features such as high-definition TV.

Over an 18-year period, channels offered with expanded basic service grew annually at 5.9 percent. General price inflation, by way of comparison, was 2.4 percent over the 18 years.

At least in part, retail prices of operators without price regulation are higher than those with regulated rates, since non-regulated providers sell tiers with more channels.

The average monthly price (excluding taxes and other charges) of expanded basic service for all communities surveyed increased by 5.1 percent over the 12 months ending January 1, 2013, to $64.41, compared to an annual increase of 1.6 percent in the Consumer Price Index (CPI).

Service providers also generate revenue in other ways, such as charging customers for use of equipment in their homes.  


Edited by Maurice Nagle

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