Mediacom announces rate hike

Published 9:20 pm Monday, December 5, 2005

VALDOSTA — In a move to compensate for spiraling programming costs and infrastructure investments, cable television and high-speed Internet provider Mediacom announced a rate hike for all family cable customers, effective Feb. 1.

Family cable, previously known as expanded basic cable, is the company’s most popular product offering and rates will increase $3.50 to $39.95 per month.

Rates for Mediacom’s digital cable customers will remain unchanged, as will Internet prices, said Sally Bloom, director of operations for the company.

“(Rate hikes) are never any fun, but the programming costs and license fees were primarily the reason,” Bloom said. “We made investments in new technology in all of our systems; investments in customer service. Our capital expenditures for the year equated to about $250 per subscription.”

She also noted the company was adding eight channels to its cable line-up as well as a government access channel. Mediacom also plans to offer Video On Demand services later this year. VOD enables customers to choose from a list of selected movies and watch one immediately, rather than the current pay-per-view system in which movies show at a certain time.

Only digital cable customers will be able to access VOD features, which will be available sometime in 2003.

While few family cable customers will benefit from Mediacom’s infrastructure improvements without upgrading their service, Bloom said the popular cable package has substantial costs in terms of programming.

“My opinion is that these are the people where the channels that we added and programming costs most affect us,” she said. “This is the group that is receiving the benefit from the upgraded system and additional products.”

Bloom said Mediacom was not adjusting any rates in the three area markets where the company faces competition from a city-owned cable competitor, because customers in those markets recently absorbed a rate increase. Thomasville, Tifton and Moultrie all have municipal cable franchises in competition with Mediacom.

The city of Valdosta is also considering entering the market and recently formed a study committee to weigh the pros and cons of such a project.

City Manager Larry Hanson said that while pricing alone should not push a municipality into the market, rate hikes increased pressure from citizens for a city-run venture.

“As I’ve said before, rates alone cannot be the driving force behind the decision, but it does impact residents, and they pass along their displeasure to their elected representatives,” he said.

“Mediacom has heavily invested in infrastructure. That is a fact that can’t be denied, but that’s a fairly substantial increase for a family cable package. And, it’s also a fact that prices are lower in adjacent communities and that similar increases were not made in communities with competing public systems.”

Bloom said part of the rate adjustments are to compensate for the added investment Mediacom was forced to make due to the poor shape of the systems it inherited. She also said she was confident the company continued to offer good value for the money.

“There was nothing being done in these markets, and Mediacom came in and upgraded these markets and added channels. We certainly met the promise of what we said we’d do when we moved into the market,” Bloom said. “I feel like have an excellent product. That does not mean we won’t be adding new products and services as we progress.”

Mediacom is unlikely to raise rates for family cable again over the next 12 months, Bloom said, though other packages could see rate adjustments in that time frame.



To contact reporter Bill Roberts, please call 244-3400, ext. 245.