In April, cable subscribers in Boston were offered a glimmer of hope after the FCC ruled that the city would once again, after a decade of price increases from Comcast (the only cable company in town), be allowed to regulate cable pricing. But the war isn’t over, as Comcast has asked the FCC to rethink its ruling while Boston’s mayor has asked the FCC to just please not listen to Comcast.
Let’s rewind back a decade to when the FCC took away the city’s authority to regulate Cable prices because RCN had entered the Boston market (no pun intended) and the competition would keep prices down.
Except RCN never caught on, serving only a small fraction of the city’s cable customers. Meanwhile, the folks in Boston watched their cable bills go up, with the most basic Comcast package now costing about double what customers paid in neighboring cities.
Last year, Mayor Thomas Menino filed a petition with the FCC to let Boston rein in cable prices again. It took almost a year, but the commission finally agreed in April.
Comcast recently filed its own petition claiming that between RCN and satellite providers there is enough competition to pass the 15% market share threshold and let Comcast charge whatever it wants to customers.
However, Mayor Menino’s response to the Comcast petition takes exception with some of the math used in figuring that number. He claims that Comcast does not count dormitories, hotels and other similar facilities when it calculates the entire customer base in Boston, but that dorms are included when Comcast adds up the total number of “households” subscribing to competing services.
Thus, alleges Menino, Comcast is artificially increasing the market share enjoyed by its competitors.
The mayor also questions Comcast’s math on satellite competition, saying that there are only two neighborhoods in the city where satellite use exceeds 15%, and that those two neighborhoods combined only account for about 10% of the city’s households.
More importantly, argues Menino, while satellite may offer comparable TV service to cable, it is not analogous, as satellite does not provide other services like reliable broadband Internet to homes.
In an e-mail statement, Mayor Menino explains:
We are simply trying to protect a lifeline level of basic cable service for those least able to afford it. These old rules that define video competition just don’t apply anymore. We need robust broadband services in our City and a measure of competition that drives good customer service and pricing.