Could a political campaign make hay from cable companies’ rising prices, lousy customer service, and consolidation? We may soon see. Democratic presidential candidate Sen. Bernie Sanders and three fellow progressives — Sens Al Franken, Elizabeth Warren, and Ed Markey — asked FCC Chairman Tom Wheeler for information about what Sanders calls cable’s “ridiculous prices and… hidden fees.”
The request “has added urgency in the context of the proposed merger between Charter Communications and Time Warner Cable, which will only increase concentration in the cable and broadband markets,” the senators say in a letter sent yesterday, but disclosed today.
“With increasing concentration in the industry, there are now de facto telecommunications monopolies throughout the United States,” they write. “Given the lack of incentive for companies to provide better quality service and competitive prices, it is no surprise that individuals rank cable and Internet providers last in customer satisfaction when compared to other companies in other industries.” (That comment apparently refers to the industry’s dismal ratings last month in the annual American Customer Satisfaction Index.)
They specifically want to know average broadband and cable payments by state and by telecommunications provider. In addition, they want breakdowns of payments for urban areas vs rural ones.
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The senators have long had cable in their crosshairs: In April they and others asked the FCC and Justice Department to block Comcast’s planned acquisition of TWC.
Charter last month made its public interest case to the FCC hoping to persuade commissioners to support its deal to buy TWC. Charter says it would offer TWC subscribers a minimum broadband speed of 60 Mbps at a lower price than TWC currently charges. The company vowed to eschew data caps as well as usage based pricing, modem fees, and early termination fees. It adds that it “does not pass on federal or state Universal Service Fund fees to customers” and charges the same rates across its footprint.
More broadly, cable and satellite companies say that their price increases have been driven by programmers’ rising demands. Collective outlays for basic cable channels, broadcast stations, and regional sports networks have increased more than 137% since 2006 to $45.3 billion last year, SNL Kagan estimates.
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