Charter Spectrum Once Again 'Competes' By... Raising Prices

from the nickel-and-dime dept

When Charter Communications (Spectrum) proposed merging with Time Warner Cable and Bright House Networks in 2016, the company repeatedly promised that the amazing "synergies" would lower rates, increase competition, boost employment, and improve the company's services. Of course like countless telecom megamergers before it, that never actually happened. Instead, the company quickly set about raising rates to manage the huge debt load. And its service has been so aggressively terrible, the company almost got kicked out of New York State, something I've never seen in 20 years of covering telecom.

Fast forward to 2019, and despite surging competition from streaming video providers, Charter is once again raising rates on numerous services. Broadband and TV services will all be seeing major price increases next month, as will the company's hardware rental surcharges and the universe of misleading fees the industry uses to covertly jack up the advertised rate post sale. That includes the company's "broadcast TV fee," which is really just a small part of the cost of programming hidden below the line in the form of a (now) $13.50 monthly additional charge:

"With this price change, you will now pay $13.50 a month for broadcast TV fees, which is up from $11.99 a month. This will add up to $162 a year to your bill just watch free over-the-air TV you could get with an antenna."

Note: that fee had already seen a $2 bump early this year.

That Charter's response to increased streaming video competition and record cord cutting is to raise rates tells you plenty about both the level of competition it sees in broadband, and the regulatory oversight of the sector. These hidden fees in particular are something the FCC (under both parties) has been happy to turn a blind eye to. Much in the same way both parties have rubber stamped a long line of telecom and media megamergers that, time and time again, have only really netted one thing: greater sector consolidation, higher rates, fewer jobs, and worse service.

Giants like Comcast and Charter have one ace in the hole when it comes to the streaming video wars to come. They are enjoying growing monopolies over broadband access thanks to the slow, steady implosion of many US telcos. That limited competition has let Comcast respond to cord cutting and streaming by imposing arbitrary and punitive usage caps and overage fees that are incurred when its broadband users use a competitor's services (say Netflix) but not their own TV offerings. This lets them simultaneously cash in on -- and hinder -- streaming competitors.

Charter's banned from doing this due to a few flimsy conditions affixed to its 2016 merger, but those conditions expire in just a few years, meaning you can expect an even fatter broadband bill over the horizon. The FCC having just effectively neutered its oversight authority over telecom at telecom lobbyist behest certainly isn't likely to help, nor is the death of FCC privacy and net neutrality consumer protections.

Filed Under: competition, consolidation, consumer welfare, mergers, monopoly, prices
Companies: charter communications, spectrum


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  • icon
    TheResidentSkeptic (profile), 9 Sep 2019 @ 12:29pm

    At some point, the formula will fail.

    For quite some time, the billing calculation has been "wall street expected revenue" divided by "number of subscribers". As #1 continues to go up, and #2 continues to go down, the result becomes less and less affordable to the remaining subscribers, causing many to join the "ex-subscriber" club. It will be interesting to see how far the companies attempt to push this calculation.

    reply to this | link to this | view in chronology ]

    • icon
      Gary (profile), 9 Sep 2019 @ 1:01pm

      Re: At some point, the formula will fail.

      Since there is no one else on my street to bring in broadband, they will have to raise their prices pretty high before I'd cancel. Can't switch, can't run my own fibre. I'd have to move...

      reply to this | link to this | view in chronology ]

      • identicon
        Anonymous Coward, 9 Sep 2019 @ 1:10pm

        Re: Re: At some point, the formula will fail.

        Have you looked into satellite or wireless with a directional antenna?

        reply to this | link to this | view in chronology ]

      • icon
        Thad (profile), 9 Sep 2019 @ 3:32pm

        Re: Re: At some point, the formula will fail.

        I think subscribers quitting is a much bigger threat to the cable TV side of the business than the broadband internet side.

        reply to this | link to this | view in chronology ]

        • identicon
          Anonymous Coward, 9 Sep 2019 @ 3:46pm

          Re: Re: Re: At some point, the formula will fail.

          Data caps, throttling and other tricks are intended to make cable a cheaper and more reliable means of obtaining entertainment than broadband.

          Fortunately, this side of the pond, unlimited means unlimited, and DSL is delivering broadband speeds. Oh, and the only below the line charges are for use of the phone.

          reply to this | link to this | view in chronology ]

  • icon
    Bloof (profile), 9 Sep 2019 @ 12:29pm

    Hey, they are competing, just in the race to be the worst telecoms company in North America. It's a hell of a challenge to be the worst in a country with the likes of Comcast and Verizon, but I believe in them.

    reply to this | link to this | view in chronology ]

  • identicon
    Dave, 9 Sep 2019 @ 12:35pm

    The only competition these companies are really in is on Wall Street, where they compete against one another to see which one can get the most quarterly profit.

    reply to this | link to this | view in chronology ]

  • identicon
    Richard Remmele, 9 Sep 2019 @ 1:47pm

    Spectrum price increase

    The increase is approximately $9 a month orl less depending on how many boxes you have. The first year cost right now of their first level of Cable channels called Select is $57. So that means approximately $66 and you can get it streaming only if you buy an Apple TV from them for $7.50 a month until paid off or tell them you have an Apple TV and use a Roku or your Chrome Browser. They also have 4 additional Streaming Only plans at $15 or $30 where most of the increase has not in the past been felt. Since I have had the $30 plan guaranteed for two years, my Broadcast fee went up $2, so now it is slightly over $30 where is was slightly under $30 before the increase.

    reply to this | link to this | view in chronology ]

  • icon
    That One Guy (profile), 9 Sep 2019 @ 1:53pm

    'X is terrible today, but tomorrow it's just fine.'

    Charter's banned from doing this due to a few flimsy conditions affixed to its 2016 merger, but those conditions expire in just a few years, meaning you can expect an even fatter broadband bill over the horizon.

    Having timed conditions attached to mergers has always struck me as beyond absurd. If the behavior in question is a problem now, to the point that it's worth explicitly prohibiting it in the conditions attached to a merger, then it should be prohibited permanently, not just for a few years.

    Anti-competitive/customer behavior is a problem no matter what year it is, so the idea behind barring it just for a few years before giving companies the all clear is just face-palm worthy and shows how dedicated those writing the terms aren't to protecting the customers of the companies in question.

    reply to this | link to this | view in chronology ]

  • identicon
    Pixelation, 9 Sep 2019 @ 7:05pm

    Who benefits?

    Charter is raising prices so that they can provide you with better service. You deserve something for your money. Hold your breath.

    And raises were given to all of the C level employees, yay!

    reply to this | link to this | view in chronology ]

  • This comment has been flagged by the community. Click here to show it
    icon
    janwin (profile), 10 Sep 2019 @ 4:13am

    news

    Every article has useful information in this website. Thanks for sharing this kind of article. There are no changes to package prices for Spectrum Voice and Spectrum TV, said a company spokesperson. Spectrum Internet prices are increasing from $54.99 to $59.99 for those who subscribe to Spectrum TV, and from $64.99 to $65.99 for those who don't subscribe to Spectrum TV.
    Are you heard about this website https://telthebelll.online/

    reply to this | link to this | view in chronology ]

  • identicon
    Karen owen, 10 Sep 2019 @ 4:41am

    Have problems inform FCC.

    reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 10 Sep 2019 @ 5:05am

    dogs chasing tails

    If the cable company raises prices because content providers raise prices, and the same cable company provides the conduit for it's competition (that is: provides to it's customers the broadband that it's competition -the streaming companies like Netflix- uses) who wins?
    The cable company wins:
    -they're getting paid when content creators raise prices for shows
    -they're getting paid by streaming companies to enforce a type of net neutrality to prevent 'stream buffering
    -they're getting paid by "cord cutters" (I laugh) who brag about not paying a cable bill - yet these "cord cutters" are still paying the same cable company in order to watch Hulu, Netflix, etc.

    reply to this | link to this | view in chronology ]

    • identicon
      Anonymous Coward, 10 Sep 2019 @ 5:07am

      Re: dogs chasing tails

      PS. note to self - invest in cable companies

      reply to this | link to this | view in chronology ]

    • identicon
      Devin, 10 Sep 2019 @ 8:19am

      Re: dogs chasing tails

      It's about their profit margins dwindling.

      I used to pay around 200$ to comcast, then I cut the cable bill and just got the internet for 65$, I pay other companies for streaming services like netflix.

      So their income from me is less than half it used to be.

      When hundreds of thousand of people do this you dont think they are getting worried about their profit?

      Yes I get you're point we are still paying the same company but we are paying then much less.

      If they raise the price on internet enough I'll just go with a dish.

      reply to this | link to this | view in chronology ]


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