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A.N.C.C. ANALYSIS OF CABLEVISION 2008 CABLE TELEVISION RATE INCREASES November 1, 2007 Cablevision has recently announced cable television rate increases which will be reflected in customer bills in December 2007 or January 2008. In announcing the rate changes on October 26, 2007, Cablevision reported "Cablevision’s average cable television price adjustment for 2008 will be an increase of 4.7 percent, primarily a result of continued double-digit increases in the fees charged by the television networks Cablevision delivers to customers, and increased operating costs." Because Cablevision calculated this figure using the total number of subscribers in their entire market area of New York, New Jersey and Connecticut, it may not accurately reflect the increases that it's Norwalk-based system customers will absorb. The company's policy of reporting system wide percentages rather than area specific percentages began with the announced rate adjustment for 2004. Cablevision has explained that this reporting is consistent with its goal of standardizing services and rates for its entire service area. In order to more accurately identify the impact of the rate increase on Cablevision's Norwalk-based system subscribers, A.N.C.C. requested from Cablevision the "weighted average" increase for those subscribers. Cablevision declined to divulge this figure, citing competitive reasons. A.N.C.C. also has compiled the data from the new rate cards into the following table which compares the rate changes on specific services for the local subscribers:
The chart below plots the Basic & Family service rates and converter boxes over the last 8 years
When customers began receiving their bills under the new rate structure, many were surprised to find that their bills seemed much higher than was indicated in Cablevision's announcement of the new rates. For example, Cablevision stated that there was no increase in its Internet and Telephone services and that Cable TV increased an average of 4.7%. For those customers who subscribe to all 3 services they might have expected an increase of about $4 - $6 per month, depending on their level of Cable TV service. Instead they likely saw an increase of about $9 - $11 per month. This is because Cablevision was billing an "Optimum Rewards" $20 discount for customers subscribing to Digital TV plus the other 2 services before the rate increase and then reduced this discount to $15 after the rate increase. Nowhere can this be found in Cablevision announcement of their new rates. |
