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News: Cable TV Price War? Don't Count on It


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#1 OFFLINE   Mark Holtz

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Posted 30 July 2004 - 10:10 AM

From Yahoo/Reuters:

Cable TV Price War? Don't Count on It: Analysts

Cable stocks got pounded this week after several of the top U.S. operators posted a sharp decline in video subscribers, but fears of igniting a price war may be premature.

Investors fretted that cable operators, which long reigned over their regional fiefdoms unchallenged, were finally conceding defeat to satellite television services, the DirecTV Group Inc. and EchoStar Communications Corp.

Full story here
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#2 OFFLINE   Nick

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Posted 30 July 2004 - 11:18 AM

Without reading the linked article, I can tell you that cable will never compete with itself. Each local cable frachise is a monopoly in miniature and, other than satellite, has no competition at all. I don't know anyone who would move to another town just to get a cheaper cable rate. With the blinders cable operators have had on since the early '60s, I seriously doubt they will ever successfully compete where satellite is an option for consumers.

The reason many cable franchises are willing pay hundreds of dollars to 'buy back' your satellite dish rather than reduce your monthly cable rate is because cablecos will do anything to avoid reducing their high cable rate structure because they still believe that the majority of their subs will never go to satellite.

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