WASHINGTON — Cable rates rose by as much as 9.6% during the past two years, according to a report released Monday by the Federal Communications Commission.
That’s good news for cablers’ bottom lines, but bad news for industry officials who are worried about a backlash from Congress, which is hearing about the rising monthly rates from their constituents. Last week at the Western Cable Show confab in Anaheim, Time Warner vice chairman Ted Turner warned the industry that rising fees could inspire Washington to revisit rate regulation.
Referring to a recent increase in cable stock prices, Turner warned, “The greatest threat in the near term is rate re-regulation.”
In addition, the FCC found that rates in the few cable systems that faced wired competition did not rise as quickly as the rest of the country. Subscribers in areas with head-to-head competition paid 5.8% less on average, according to the FCC report.
The report was released just as the FCC plans to hold a hearing into the state of competition in the cable industry. Among the witnesses will be a representative of the Consumers Union, which has asked the FCC to implement a nationwide rate freeze.