Time Warner raises prices

Some cable-service fees rise as much as 5.9 percent, outpacing the inflation rate

Time Warner Cable's price increases, typically imposed at the beginning of each year, will again outpace inflation for many customers.

The Triangle's dominant cable television company raised rates about 3 percent to 6 percent on many packages, effective Jan. 1.

Time Warner's most popular package -- bundling Road Runner Internet service with the lowest tier digital TV programming -- will increase 3.1 percent to $107.95 a month in the Triangle, spokesman Brad Phillips said. More than half the company's 750,000-plus customers in 36 North Carolina counties subscribe to a bundle of two or more services, Phillips said.

The stand-alone standard cable package is up 5.9 percent at $41.20 a month, while the lowest-tier stand-alone digital cable offering is up 5 percent at $68 a month.

The increases for the Triangle outpaced the 2007 consumer inflation rate, which was 4.2 percent through November.

But only the TV component is increasing in price, Phillips said. Rates for Time Warner's Road Runner Internet and digital phone service are not going up in 2008.

Price increases are affecting all TV-subscription providers, whether they deliver services over cable line or by satellite, said Bruce Leichtman, a communications analyst in Durham, N.H.

"They have annual price increases from their programmers," Leichtman said. "If they didn't pass along the costs, they'd be losing money."

The cable companies say they are held hostage by the programmers, while consumer advocates say cable TV companies are profiteering from lack of competition.

Many consumers, including Federal Communications Commission Chairman Kevin Martin, are calling for a-la-carte service that would allow cable customers to sign up for individual stations instead of multichannel packages. Cable companies say structuring programs that way would make many popular channels unaffordable.

Prices for cable television have gone up 100 percent in the past decade, according to Jeff Kagan, an Atlanta communications analyst. He predicts that only competition from phone companies will pressure cable companies to hold down increases.

AT&T offers TV programming, called U-verse, in more than a dozen markets and has said it would bring the service to North Carolina this year on a limited basis.

Currently, the principal competition to cable comes from satellite companies.

DirecTV, the leading satellite service company, raised its average prices nearly 4 percent in March. The company hasn't announced this year's prices.

Rival Dish Network announced Monday that it was freezing prices on its most popular packages until February 2009.

Not all Time Warner customers saw prices go up Jan. 1.

New customers on special promotions have locked in on discounts for 12 months.

For example, those who took advantage of an $89.85 promotion for three services will see the price rise to $107.95 when the promotion expires, experiencing a price jump of 20 percent.