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CNN Live At Daybreak
Cable Rates Rising: Consumers Pay More For Basic Service
Aired November 24, 2003 - 06:16 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
CAROL COSTELLO, CNN ANCHOR: Time now, though, for a little 'Business Buzz.' If you think you are paying more for cable, you know what you're talking about.
Carrie Lee has more on that story live from the Nasdaq market site.
Yes, I feel the pinch.
CARRIE LEE, CNN FINANCIAL NEWS CORRESPONDENT: A lot of people do, Carol, and we have finally gotten some hard numbers to back up these cable hikes a lot of people have been talking about.
According to the General Accounting Offices, and this is a congressional arm, the average monthly rate for expanded basic cable service is $36.47 and that is up 40 percent since 1997. Much faster than the inflation rate, which, during that time, has increased 12 percent.
Now average expanded basic cable typically includes CNN, ESPN, MTV, is 63 channels compared with 48 in 1997, so people are getting more bang for their buck, per se.
But people who feel that maybe cable rates have been hiking up a little bit too much, and by the way, the cable industry says that technology and programming costs are responsible for the hikes. Well the GAO report, which has been commissioned by Senator John McCain, stops short of saying that anything should actually be done about these price increases or whether they are justified.
And it looks like rates are going to continue to go up. In fact, Cablevision Systems did say on Friday it plans to raise rates by 3.2 percent next year. So, Carol, they are not coming down anytime soon. In fact, they probably are going to continue to go up a little bit.
COSTELLO: Forty percent, that's just crazy.
LEE: A very big hike. Yes, and there are a lot of great shows there and they are adding more programs, but still, it is a big chunk out of monthly expenses for a lot of people.
COSTELLO: Well I know what my cable bill is and it's expensive.
Quick look at the futures.
LEE: Sure. It looks like technology issues could see a little bit of a boost at the open. Stocks overall, though, pointing to a pretty flat open. We did see stocks decline a little bit on the week last week. You can see here the Dow, the Nasdaq, the S&P 500 down all over 1 percent.
We are going to be watching shares of Time Warner today, parent company of CNN. As early as today, the company could announce it's selling its Warner Music unit for $2.6 billion, probably going to be sold to a group headed by former Seagram chairman Edgar Bronfman Jr. This according to Reuters.
Carol, back to you.
COSTELLO: It will be interesting to see what it does to the stock, huh?
All right, Carrie Lee reporting live...
LEE: Actually, the stock...
COSTELLO: Go ahead.
LEE: ... was down about 1 percent in Europe so far -- up 1 percent, I'm sorry. Up nearly 1 percent in Europe, just FYI there.
COSTELLO: That's good. It's better it's up, even though it's just 1 percent.
Carrie Lee live from...
LEE: We'll take it, right?
COSTELLO: Yes, exactly.
Carrie Lee live from the Nasdaq market site.
TO ORDER A VIDEO OF THIS TRANSCRIPT, PLEASE CALL 800-CNN-NEWS OR USE OUR SECURE ONLINE ORDER FORM LOCATED AT www.fdch.com
Aired November 24, 2003 - 06:16 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
CAROL COSTELLO, CNN ANCHOR: Time now, though, for a little 'Business Buzz.' If you think you are paying more for cable, you know what you're talking about.
Carrie Lee has more on that story live from the Nasdaq market site.
Yes, I feel the pinch.
CARRIE LEE, CNN FINANCIAL NEWS CORRESPONDENT: A lot of people do, Carol, and we have finally gotten some hard numbers to back up these cable hikes a lot of people have been talking about.
According to the General Accounting Offices, and this is a congressional arm, the average monthly rate for expanded basic cable service is $36.47 and that is up 40 percent since 1997. Much faster than the inflation rate, which, during that time, has increased 12 percent.
Now average expanded basic cable typically includes CNN, ESPN, MTV, is 63 channels compared with 48 in 1997, so people are getting more bang for their buck, per se.
But people who feel that maybe cable rates have been hiking up a little bit too much, and by the way, the cable industry says that technology and programming costs are responsible for the hikes. Well the GAO report, which has been commissioned by Senator John McCain, stops short of saying that anything should actually be done about these price increases or whether they are justified.
And it looks like rates are going to continue to go up. In fact, Cablevision Systems did say on Friday it plans to raise rates by 3.2 percent next year. So, Carol, they are not coming down anytime soon. In fact, they probably are going to continue to go up a little bit.
COSTELLO: Forty percent, that's just crazy.
LEE: A very big hike. Yes, and there are a lot of great shows there and they are adding more programs, but still, it is a big chunk out of monthly expenses for a lot of people.
COSTELLO: Well I know what my cable bill is and it's expensive.
Quick look at the futures.
LEE: Sure. It looks like technology issues could see a little bit of a boost at the open. Stocks overall, though, pointing to a pretty flat open. We did see stocks decline a little bit on the week last week. You can see here the Dow, the Nasdaq, the S&P 500 down all over 1 percent.
We are going to be watching shares of Time Warner today, parent company of CNN. As early as today, the company could announce it's selling its Warner Music unit for $2.6 billion, probably going to be sold to a group headed by former Seagram chairman Edgar Bronfman Jr. This according to Reuters.
Carol, back to you.
COSTELLO: It will be interesting to see what it does to the stock, huh?
All right, Carrie Lee reporting live...
LEE: Actually, the stock...
COSTELLO: Go ahead.
LEE: ... was down about 1 percent in Europe so far -- up 1 percent, I'm sorry. Up nearly 1 percent in Europe, just FYI there.
COSTELLO: That's good. It's better it's up, even though it's just 1 percent.
Carrie Lee live from...
LEE: We'll take it, right?
COSTELLO: Yes, exactly.
Carrie Lee live from the Nasdaq market site.
TO ORDER A VIDEO OF THIS TRANSCRIPT, PLEASE CALL 800-CNN-NEWS OR USE OUR SECURE ONLINE ORDER FORM LOCATED AT www.fdch.com
