Cable TV, internet rates on way up

Media firms blame nonstop rise of programming costs

Cable TV and internet customers will have to pay Comcast an extra $78 this year because of a price hike that went into effect this month. AT&T recently raised the price for its DirecTV satellite service, adding another $108 to customer bills.

Hulu just jacked up its price by $10 a month, although many of its customers are families who switched to the streaming service in order to cut the cord from high-priced cable TV companies. Other popular video-on-demand services like Netflix and Disney also will charge more this year.

The timing of the price increases couldn't be worse for millions of Americans out of work, stuck at home and struggling to keep up with bills. But big media companies put the blame on the ever-rising cost of programming -- most notably for broadcast TV and sports, which are the biggest factors driving the constant price increases that get passed down to consumers.

"It's always more than inflation. They do it every January, and there's absolutely nothing we can do to stop this," said Mark Cooper, director of research at the Consumer Federation of America in Washington, D.C.

The annual rate increase is part of an ongoing debate over competition and regulation in the cable/broadband business, and there will likely be more efforts to revisit the issue in the near future.

Using publicly available data from municipal utility providers and other sources, home services comparison website DecisionData.org found that the average U.S. household cable bill of $217 a month exceeds what families spend on most other utilities combined.

Cable bills stay relatively similar across household sizes, whether it's one person living in a small apartment or a family of 10 living in a large house.

"It's normal for the average consumer to look for ways to save money on things like their electric or water bills through conservation efforts," the report said. "But what we still don't hear discussed more frequently is how to cut costs on what is becoming every household's biggest utility bill.

"It's not as if cable is optional anymore, with having internet access at home being almost as important as electricity at this point."

Cable companies point to rising fees they pay to carry TV networks. Networks such as ABC, Disney and ESPN require cable and satellite TV and streaming services like Hulu to pay for the rights to carry their channels. The networks have their own rising costs, but they are willing to pay more for sports.

The big media companies that own the TV networks -- like Warner Media, NBC Universal, Viacom CBS and AT&T -- also are faced with higher price tags for creating and producing content. The final season of HBO's "Game of Thrones" cost parent company Warner Media $15 million per episode -- in the neighborhood of a movie theater budget.

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