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Comcast moderates its annual cable TV rate hike, but the cost of Internet access is rising faster
[August 23, 2012]

Comcast moderates its annual cable TV rate hike, but the cost of Internet access is rising faster

Aug 22, 2012 (The Oregonian - McClatchy-Tribune Information Services via COMTEX) -- The good news Comcast isn't raising cable TV rates by as much this year, at least for its standard digital packages.

The bad news Comcast plans a substantially higher price hike for Internet service, which hadn't had any rate hikes for several years until 2011.

Local cable regulators received notice of Comcast's planned rate increase this week. The higher prices take effect October 1.

Federal law exempts most cable rates from regulation, but local authorities do have some oversight of basic cable. Comcast raised those rates last month.

Across the board, the new rates affect roughly 600,000 households that subscribe to Comcast services across Oregon and Southwest Washington. This is the first general rate increase this year after two that Comcast levied in 2011.

The monthly cost of Comcast's basic "Digital Starter" package now weighs in at $67.49, plus fees, or about $810 annually.

Most subscribers pay a good deal more than that by adding high-definition video, DVRs, premium movie channels and other perks.

Cable rates go up every year, usually well in excess of broader inflation rates.

This year, the 2.3 percent increase in "Digital Starter" is just below inflation in the Portland area, 2.5 percent.

"Maybe we're just jaded, but it does seem almost restrained given past experience with these guys," said Fred Christ, policy and regulatory affairs manager for the Metropolitan Area Communications Commission in Washington County.

Overall, Comcast says the average customer will pay 3.3 percent more for phone, Internet and TV services.

Customers under promotional contracts won't pay any extra until their current deal runs out.

"We continue making investments in next-generation technology to add value to our products and improve service. In the last year alone, we've added several channels and launched new interactive applications and multi-platform content that customers want and value," Comcast said in a written statement.

"For example, this summer, we're launching the Pac-12 Network, which provides our customers another, new option for accessing a wide variety of sports and compelling programs." The cost of Comcast's standard cable TV package is roughly equal to what a typical Oregon household pays for natural gas.

Homes need heat, of course. Cable TV is optional, though even in hard times viewers are loathe to give it up.

Oregon regulators say they've seen no dropoff in cable TV subscriptions during the protracted economic downturn.

"Comcast subscribers continue to grow out here," said Christ, the Washington County regulator.

That may be in part because Frontier Communications is retreating from the FiOS cable TV service it acquired from Verizon in 2010, and Comcast is picking up the slack. Frontier, which serves Portland's suburbs but not the city itself, has kept its rates steady at around $65 a month.

Viewers now have a growing array of alternatives to cable, with Netflix, Apple, Amazon, YouTube and others offering original programming or providing online portals for popular cable shows such as "Breaking Bad" and "Mad Men." Overall, the growth in subscriptions to cable and satellite TV has stalled. Nationwide, subscriber totals have occasionally fallen in the past few years -- but only slightly.

Note: This story has been corrected to remove reference to an installation fee that Frontier Communications no longer charges.

-- Mike Rogoway; twitter: @rogoway; phone: 503-294-7699 ___ (c)2012 The Oregonian (Portland, Ore.) Visit The Oregonian (Portland, Ore.) at Distributed by MCT Information Services

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