Posted on 01/06/2005 5:27:49 PM PST by holymoly
Satellite TV customers are facing price rises, as operators Dish Network and DirecTV hatch plans to increase rates, despite an ongoing rivalry with cable providers.
Dish Network, owned by EchoStar Communications, plans to raise subscriptions by $2 to $4 a month, the company said Thursday. That translates to an average of 4.3 percent on average charges of $56.11. The new rates will take effect Feb. 1 and affect certain packages, such as the basic service.
DirecTV is also planning to announce a rate hike this quarter, but details are not yet available, said Robert Mercer, a company spokesman. Currently, DirecTV charges an average monthly rate of $66.46 per subscriber.
Despite the rivalry between satellite and cable TV operators, consumers have not benefited from downward pressure on subscription prices.
The satellite companies themselves put the increases down to price of content and to the cost of adding new features to a monthly service. "We've seen programming costs that have consistently risen over the years, and that is primarily why we have seen these price increases," Mercer said.
Dish Network faced a 7 percent increase in programming costs last year, said Kelley Baca, a company spokeswoman.
The pending rate increases will mark the third consecutive year both companies have raised their monthly subscriber rates. DirecTV, for example, increased its charges by an average of 3.3 percent for all its packages last year and in 2003. Dish Network, meanwhile, averaged an increase of less than 2 percent last year and a 4 percent increase in 2003.
"Programming costs are still rising substantially more than inflation and, for satellite operators, customer acquisition costs have been rising significantly as well," said Craig Moffet, an analyst at Bernstein & Co. "It's reasonable to expect prices will continue to rise at an excess of inflation for the foreseeable future."
Cable operators face the same high variable costs of programming as satellite companies do, Moffet said.
Comcast, for example, is expected to raise its rates an average of 5.8 percent this year.
Combined, the satellite and cable industries have been growing at a rate of 2 percent a year, further reducing the incentive to slash prices, Moffet added.
"This is an industry where there are strong incentives for all the players to compete on product differentiation rather than price," Moffet said.
He added that a price war, spread among millions of monthly customers at a time when costs are steeply rising, makes it prohibitive to engage in such tactics.
Dish Network has 10.4 million subscribers, while DirecTV 13.5 million, according to the companies' figures.
agreed.
Let the public drop the PC channels like MTV, Lifetime, and the new homosexual channel that is going to be foised upon the basic channels.
Some operators pay to be on the lineup others are paid to be there. It would be interesting to see a list of the two types broken down.
those channels pay to be carried.
i dropped the Sunday Ticket football pkg this year because the costs were just getting too high.
Isn't it time for these services and cable to let subscribers individually select channels as they like and put their viewing packages together?
Yes, content that nobody wants, just any excuse to fill billable bandwidth. You know, the Accordian Music Channel, the Darts Tournament Channel, the "I Love Lucy" channel, and, as you said, a number of shopping channels.
I hope I live long enough to have the plan you suggested.
I don't watch 3/4 of my current choices.Waste of money!
i dropped the Sunday Ticket football pkg this year because the costs were just getting too high.You obviously don't have your priorities straight! ;-)
Yeah, my wife will only have Lifetime, and Home and Garden.
ever look at the 9000 range? Its all sales.
instead of watching one game, I found myself endlessly switching from game to game to game - I wasn't enjoying any of them, just channel surfing. they cut in with enough highlights of other games during the local game, to let you see most of the action.
Get an old C band dish and receiver from someone that no longer wants theirs. There are lots of them available for the asking, mostly from people that upgraded to the little dish for Dish Network or Direct TV.
You can subscribe to Fox News for less than 5$/yr
Or get a package with CNN/HLN/CNNI/FOXNEWS for 19.50/yr.
A&E/History channels are 12.50/yr as a package.
Most of the other channels that are worth watching are
similarly priced..
I'm so sad though that on Dec31 they stopped feeding Turner Classic Movies on C band :-( I loved that channel... I switched to American Movie Classics though, so at least I have something in B+W to watch :-)
9000? my channels only go up to 999.
mine goes to 9900. ?
120 channels but almost nothing to watch! What's up with that?!
In parts of Canada there's Look TV that does precisely that. I've been a subscriber for about 5 years now.
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