Predatory Pricing Or Plain Old Competition?

from the interesting-debate... dept

With all of the debates going on about muni broadband, there’s another issue that’s clearly going to come up concerning pricing. It’s already happening in places that offer muni-TV apparently. Broadband Reports points to an article accusing Charter of predatory pricing on their cable TV service. It turns out that in Ashland, North Carolina — where there is muni competition — Charter was offering service for $24.15 per month. In neighboring communities where there was no muni service, the same package ran $45.99 per month. That’s quite a difference. When alerted, Charter claimed they didn’t know about it, and contacted local managers to kill the “promotional” program. The question, then, is whether or not this is “predatory pricing,” as the article implies? One person is quoted saying: “They are either underselling for the sake of competitive pricing or gouging the heck out of everybody else. Either way, it’s not a pretty picture. I’m very concerned about the pricing issue.” However, if the presence of a muni helped drive down prices, that’s probably a good thing for residents. In fact, thanks to this story, now people are paying more. Admittedly, if the super low prices were designed to drive the competition out of business, that might be a different story — but if it’s simply forcing more competitive pricing, that’s good.

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Comments on “Predatory Pricing Or Plain Old Competition?”

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Precision Blogger (user link) says:

The great trick is to have competition!

Generally, state boards hobble communities so that they cannot regulate cable or encourage competition.

Worst of all, the cables in the ground belong to the company that laid them.

If states were to seize the cables by emminent domain (probably illegal), then cable companies would compete for franchises; no company can be competitive if it has to lay its own cable to catch up.

It’s too late now, but ORIGINIALLY all states should have stipulated that the cables become municipal property after some number of years. 20 years would have been just fine.
– the Precision Blogger

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