Did The Annual New Year's Pay TV Price Hikes Finally Go Too Far?
Did the annual New Year's pay TV price hikes finally go too far? Cross-tier price hikes are an annual New Year's ritual in the pay TV industry, as predictable as the ball dropping in Times Square or turn-of-the-year carriage blackouts.
But given the current rate of linear pay TV customer attrition, maybe a little New Year's resolution on behalf of the major operators would have been a good thing.
In early December, fresh off losing 251,000 customers in the third quarter for its linear DirecTV platform, AT&T announced that prices for all of the satellite TV carrier's tiers would shoot up by $2 to $8.
Cox Communications, meanwhile, began notifying customers that it would institute across-the-board price increases starting Jan. 7, with rates for video packages increasing by $1 to $5 a month, and internet tiers shooting up $2 to $4.
A few days later, Comcast and Dish Network, which also experienced significant cord cutting in the third quarter, chimed in with increases of their own. Comcast had already upped its programming "surcharges" in October. In fact, since it first instituted the sneaky fees it passes on to customers for things like broadcast retransmission and regional sports networks in January 2015, Comcast had increased them by 241%.
On the pay TV side, Cox representative Todd Smith told Fierce that "the rising cost of programming content continues to be the main reason why our video prices increase."
"Like others in the industry, as programming costs increase, we periodically adjust pricing, added AT&T spokesman Eric Ryan. "These prices are still a great value and [are] very competitive."
Of course, with the traditional pay TV business having shed as many as 3 million customers in 2017, and low-cost virtual pay TV options proliferating, you'd have to think that this is the year traditional price-spiking tradition might end … or at least ebb a little.
"We've long since passed the point where programmer price increases are self-defeating," MoffettNathanson analyst Craig Moffett told Fierce in an email. "The biggest driver of cord cutting is that prices are too high. But the solution of too many programmers is to raise prices even faster to compensate. It's like a car that is headed for a cliff, with a driver that believes the only solution is to step on the gas."
According to S&P Global Market Intelligence, consumer cable and satellite TV bills have increased 53% since 2007, to $100.98 in 2017.
"We must pass along a portion of these higher costs to our customers," a representative from Comcast told FierceCable via email, echoing Cox and AT&T's defense regarding rising program licensing costs. "As a result, on average, nationally, the customer bill will increase by 2.2% in 2018."
The increases also come amid the Republican-led corporate tax rate rollback, a polarizing bill passage that has led many telecom service customers wondering what companies like AT&T are doing spiking prices at a time when their tax rate is decreasing from an effective rate of 32.7% to around 21%, saving the company perhaps billions.
Two To View – A Couple Of Amazing Videos You Don't Want To Miss
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|Hangin' With A Hammerhead Shark |
What's super scary and super cool all at the same time? Two scuba divers filming a curious hammerhead shark.
| ||The PC Michelangelo |
Frugality drove this artist to find a different way to paint, and he now creates beautiful images with Microsoft Excel!
WatchTVEverywhere Lets You Be Creative With TV Viewing
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Introducing The All New Hallmark Drama Channel
Congratulations to ValuNet FIBER's
Attention TV subscribers! The all new Hallmark Drama Channel has been added to every ValuStandard, ValuPlus and ValuElite package. Check it out on Channel 144!
Business Highlight of January!
Founded in 1988, Holiday Resort is a 120-bed facility located in Emporia, Kansas, in close proximity to all local hospitals. Not only has Holiday Resort long been acknowledged as a leading senior care provider, their fully renovated, beautifully designed facility is now widely recognized as one of the most attractive in the area.
Through the years, Holiday Resort
has continued to grow and evolve to meet community needs, and today offers a full continuum of care, from temporary respite stays, to short-term rehabilitation, to long-term skilled nursing care, as well as a broad array of specialty programs and services.
Moreover, the convenient location provides immediate access to hospital specialists in virtually every area of medicine, as well as emergency care, should it be required.
The Holiday Resort Mission: Helping Elders through Attentive, Respectful and Timely Service.
"At Holiday Resort, we are dedicated to creating a sensitive, nurturing and comfortable home where each patient and resident receives personalized care and attention. We take pride in our resident-centered philosophy and approach to care. Whether in our short-term rehabilitation, long-term skilled nursing, or specialty programs, this philosophy is reflected in our commitment to promoting optimum independence and quality of life for all those who pass through our doors."
Congratulations to ValuNet Fiber's Business Highlight of the Month, Holiday Resort!
FREE Featured Apps – These Three Are Well Worth A Look
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Like a friendly personal assistant, this app can help you plan your day, remember appointments, and make or share idea lists.
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Test your consumer savvy with this game that has you guess the logos of more than 1,000 brands. Stuck? Ask for a fun hint.
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(iOS only) Aspiring interior designers will love this app, which allows you to "place" furniture or other virtual objects in your home.
Stay Alert – Watch Out For New Ransomware Threat
Go Pinterest-ing! – Cool Stuff To Pin On Your Pinterest Boards
Sites of the Month – Great Sites To Check Out In January
| Sundance Film Festival |
sundance.org – The world-renowned Sundance Film Festival will take place this year January 18 through 28 in Park City, Utah. The festival is presented by Sundance Institute, a nonprofit organization dedicated to the discovery and development of independent artists and audiences. Visit this site to learn what's new this year and how to attend.
| Eating Well In The New Year |
eatingwell.com – Keeping New Year's resolutions is tricky, but having the right resources can help. Complete with videos, the EatingWell website is a great healthy eating companion with articles and recipes for a wide variety of food-related goals including losing weight, sticking to a special diet, or simply planning meals ahead.
| Ready For Flu Season? |
health.com – Exercising, eating healthy, getting enough sleep, and washing your hands are good pieces of advice any time of year, but especially during cold and flu season. Visit this site to read more about these tips and many others to help you stay healthy this winter.
| Travel Planning For 2018 |
fathomaway.com – Take yourself out of the winter doldrums by visiting this site and dreaming about your next trip. Know where you want to go? Click the Destinations tab and learn more about the area you want to visit. Not sure? Click the Inspiration tab to get ideas based on why you love to travel.
Short Tutorial/FAQ – What Internet-Related Terms Have Been Added Recently To The Merriam-Webster Dictionary?
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