Wild jump in cable TV prices

The FCC’s latest Report on Cable Industry Prices shows what most any subscriber has watched with dismay: cable prices continue to climb without stopping. Worse, the general cost of paid TV service in the U.S. has risen four times the rate of inflation.

According to the report, “Basic cable service prices increased by 6.5 percent for the 12 months ending January 1, 2013. Expanded basic cable prices increased by 5.1 percent for those 12 months, and at a compound average annual rate of 6.1 percent over the 18-year period from 1995-2013.”

At the same time, the Consumer Price Index rate of inflation was just 1.6% over that same time. Not that this rise is anything new... just somewhat worse.

However, one sector did not rise at the same trajectory: the so-called “wireline rivals of incumbents.” This group includes cable competitors such as Verizon's FiOS and AT&T's U-Verse.

While cable TV bills rose at an overall average rate of 6.5 percent, the rate increase for these wireline competitors rose only one percent age point. Moreover, price per-channel at wireline competitors actually dropped some 8.3 percent.

Although no one is accusing the cable industry of price-fixing, it’s clear that the only real competition the industry faces is from wireline rivals.

Report On Cable Industry Prices (FCC Report, May 16, 2014)
 
Cable Prices Have Risen Four Times the Price of Inflation (DSL Reports, May 19, 2014)