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Are cable customers fleeing due to pending rate hikes?

television

As cable prices rise, use these ideas to track trends in your local coverage area.

With a number of cable providers kicking off the new year by raising rates on subscribers, now might be a good moment for a look at cable television costs in your area, and alternatives for consumers — who are cutting the cable cord by the hundreds of thousands per year, according to recent reports. 

That might be a drop in the bucket compared to the base of 100 million subscribers (a figure that roughly corresponds to the number of households in the United States) but it’s a trend worth exploring as cable operators keep boosting bills and resisting the a la carte programming that video mavens can get via the Internet.

You can approach this as a business story pertaining to the cable operator(s) in your region, or a personal finance story aimed at showing TV viewers alternative cost scenarios, or both.  The latter might be best servecd by a large chart or clip-and-save infographic rather than a prose story — including channel line-up for each provider.  (A good sidebar would be a graphic of a typical bill, with taxes and fees explained.)  

This EnGadget article does a good job of explaining the current national trend as well as the technology behind alternatives like Netflix and Hulu.  (It also poses the interesting question: Will cable TV providers merely jack up rates for Internet if they find more customers discarding TV in favor of streaming services?)  Minyanville asks if it’s “Panic time for cable operators?” and be sure to read this recent New York Times piece about how the cost of sports channels dominates cable bills — even for non-sports viewers. 

Here’s a chart from the National Cable & Telecommunications Association showing customer counts going back to the 1970s.  The consulting firm that tracks those numbers, SNL Kagan, compiles a wide range of media market data ndustry, some to the ZIP code level.  A spokeswoman for the Charlottesville, Va.-based firm said requests from reporters for local data are handled on a case by case basis. 

Another trend, as reported by Yahoo!:  Consumers not yet ready to cut the cord are “churning” through introductory offers from satellite TV and Internet Protocol TV (iPTV) offered via set-top boxes by Google, Apple and — according to reports this week — soon by Intel.  (Note the Infonetics report cited in the Yahoo! story — it’s behind a paywall but you might call the company and ask if they share data with journalists.) Here’s a Forbes story that wonders if iPTV can “kill the cable industry as we know it;” a worthy question for the standard cable operators in your market.  What are they doing to compete? 

And what are cable companies doing to entice former subscribers?  Here’s a recent NYT story about an upcoming $50 million campaign by Time Warner to lure back ex-patrons; in my neck of the woods, where competing cable companies operate in some municipalities, barely a week goes by without dueling offers in the mailbox.  As local operators what deals are out there for households willing to return.

The Federal Communications Commission requires cable operators to make certain records available upon request; here’s a link to the FCC site; note pending changes to the rule as requested by the cable companies.  

About the Author

Veteran financial writer Melissa Preddy served as a business writer, editor and columnist for The Detroit News from 1995 to 2008, is a Michigan-based freelance journalist. She now works as a writer and editor for a medical research unit of the University of Michigan Medical School. Follow her daily posts. | E-mail: Melissa Preddy

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