WASHINGTON — DirecTV and EchoStar together now control 12.5% of the subscription television market and are poised to gain even greater market share now that they may offer local TV channels, according to an FCC report.
The nation’s two DBS companies have more than 10 million subscribers.
Although cable’s market share is declining, the total number of pay TV households has increased, so the industry actually saw a 2% increase in subscribers to 66.7 million. Almost 81 million households now have some form of subscription television service, according to the FCC report.
The FCC also found that cable rates continue to rise faster than inflation. From June 1998 to June 1999 they rose 3.8%, compared with an overall 2% increase in the consumer price index.
Some of the increases in cable rates is attributable to programming costs, which rose 16.3%, according to the report. The FCC also found that in areas where cable faces head-to-head competition from a telephone company or other wired competitor, price hikes are more modest.