Monthly Cable Rates Rise

W A S H I N G T O N, Feb. 15 -- Consumers footed heftier monthly cable bills last year, as companies boosted their rates for programming and equipment by 5.8 percent, according to government figures.

That means cable costs for basic programming, expanded basicservices and equipment — like a remote control — rose faster than inflation for the 12-month period ending July 1, 2000.

The Consumer Price Index measured general price increases of 3.7percent during the same period.

Cable companies said the hikes were result of cost increases forthe popular channels they must buy from programmers — such assports shows — and money spent to upgrade their systems to providenew services.

The increase was the same both for cable companies that facecompetition in their markets as well as those that don't, accordingto the Federal Communications Commission report.

Cable subscribers living in markets without competition paid onaverage $32.25 for programming and equipment in July 1999. A yearlater, their monthly bill for those services increased to $34.11.

Consumers in places where cable operators are challenged byrival providers continue to pay slightly less than that, thecommission said. As of July 2000, those subscribers paid $32.40,the FCC said.

Call for Regulation

The report prompted consumer advocates to renew their calls forthe government to cap cable prices, arguing that competition fromsatellite TV services, like EchoStar and DirecTV, has failed toslow price increases.

"Consumers need a lid on these rates to prevent ongoing pricegouging," said Gene Kimmelman of Consumers Union.

The FCC stopped regulating most cable TV services nearly twoyears ago, following the directive of a 1996 law. And thecommission's new chairman, Michael Powell, has said he doesn'tthink that regulators need to step in now.

Cable companies say they actually have done reasonably wellholding down their prices, even as they face burgeoning costs forpopular programming — like sports channels. They also have investedmoney to upgrade their cable systems so they can offer high-speedInternet and local phone service to consumers.