WASHINGTON - Cable TV customers saw their rates rise an average of 8.2 percent last year, the Federal Communication Commission reported yesterday.
The jump in rates for programming services and equipment marked the fifth straight year that cable prices had sharply outpaced general inflation, a trend that some consumer experts say reflects an industry monopoly.
The FCC's annual report, for the 12-month period ending July 1, 2002, shows that average monthly charges increased:
3.7 percent for basic service, from $13.93 to $14.45.
10.8 percent for expanded programming, from $19.88 to $22.02
12 percent for equipment, from $3.25 to $3.64.
That pushed the average total rate to $40.11 last year - an increase of 32 percent over five years, compared with 12 percent for the Consumer Price Index in the same period. However, the average number of channels offered also grew by 25 percent over that period, to 62.7 last year.
"Cable rates are going up way above the inflation rates," said Adam Goldberg, policy analyst for Consumers Union. "Congress needs to step in and take some action to keep cable rates down."
Satellite TV is not a viable alternative for a significant number of consumers, Goldberg said. If Congress does not want to "put a lid" on the cable monopoly, it should at least allow subscribers to pay for channels on an a la carte basis, he said.
Sen. John McCain, the Arizona Republican who chairs the Commerce, Science, and Transportation Committee, also expressed concern in a written statement.
"The cable industry has risen to new heights in their apparent willingness and ability to gouge the American consumer," McCain said. "These increases defy logic - the Committee on Commerce, Science, and Transportation will continue to focus on this issue in the months to come."
"Cable prices reflect a variety of increasing costs facing cable operators," Rob Stoddard, senior vice president of communications and public affairs for the National Cable and Telecommunications Association, said in a statement. Stoddard noted that operators invested more than $15 billion in system upgrades during the survey period, "while incurring greater than inflationary increases in personnel and programming."
"Although cable prices have increased, cable consumers are also enjoying increased value for their entertainment dollar," he said. "Compared with taking a family of four to a single movie, concert or professional sports event, a month of basic cable remains a superior entertainment value."
FCC Commissioner Michael Copps dissented from the report, stating that the commission has not "delved as deeply as Congress expects" in its analysis of increasing cable rates.
"We hear from consumers who are fed up with continual increases in their cable bills," Copps wrote in a statement. "When consumers keep getting hit in the pocketbook year after year, we must commit the resources necessary to gather the information so we can make informed decisions to ensure that consumers are protected."
Cox Communications Inc., the nation's fourth largest cable TV provider, is owned by Cox Enterprises Inc., the corporate parent of Cox News Service.
