Congress Plugs Into The Sudden Surge In Cable TV Rates
Tuesday, May 06, 2003SUSIE GHARIB: Have you taken a look at your cable-TV bill recently? If you haven't, you might be in for sticker shock. Cable prices have jumped an astounding 50 percent since the industry was deregulated in 1996. As Stephanie Woods reports, that price hike has caught the attention of Congress.
STEPHANIE WOODS, NIGHTLY BUSINESS REPORT CORRESPONDENT: If you want your ESPN, your cable company is likely to make you take the Disney Channel too. Cable companies say they have no choice. The media firms who own the programming pressure them to add channels to the basic cable package.
CHARLES F. DOLAN, CHMN., CABLEVISION SYSTEMS CORP.: Unwanted programming is being forced into the home, particularly sports programming. The cable bill at the end of the month is increasing against the customer's wishes.
WOODS: Programmers says it's not their fault that cable rates are going up. They say the cable companies are saddling customers with the costs of upgrading their networks to deliver broadband services.
LEO HINDERY, JR., CHMN. & CEO, YES NETWORK: You cannot lay the blame for rate increases on programmers like this industry is trying to do today.
WOODS: So Senator John McCain called both sides together today to propose that cable companies offer ESPN and other channels a-la-carte.
SEN. JOHN MCCAIN (R-AZ), CHMN., COMMERCE COMMITTEE: I fail to understand why any customer should be forced to pay for programming they don't want.
WOODS: But ESPN says it doesn't want to be a stand-alone service. The sports network, which just last week announced a 20 percent increase to cable operators, says ripping it and other popular networks out of basic cable packages will end up costing consumers more. Meanwhile, consumer groups are wary of anything that gives big companies more clout.
GENE KIMMELMAN, CO-DIRECTOR, CONSUMERS UNION: It means higher prices for consumers and fewer companies controlling the most important sources of news and information in the local market.
WOODS: The scrutiny on the industry comes as the Federal Communications Commission is re-writing the rules that govern media ownership. On June 2 the commission will vote on dramatically scaling back how many media outlets any one company can own. Stephanie Woods, NIGHTLY BUSINESS REPORT, Washington.
