Time Warner’s rate hike turns clients off
Increase follows dispute with program provider Viacom
Time Warner Cable is raising monthly rates up to $6 starting Feb. 1.
The details were first revealed in a monthly brochure sent late last week to Time Warner’s 330,000 subscribers and confirmed Monday by spokeswoman Robin Wolfgang.
The rate increase was met with little sympathy from subscribers at the Time Warner building on Chicago Street. A steady stream of people were there at lunchtime to pay bills, change services and, in the case of a few, to close out their service so they could switch to another company.
“The bills should be a little lower. They shouldn’t be going up, they should be going down,” said a visibly irritated Lee Manuel, referring to tough economic times.
Otha Smith, who lives on a fixed income, said he was “outraged” by the rate increases.
Joe Mascia was also bothered. “I have no problem with corporations making money, but at a time like this when people are losing their homes . . . let’s wait until the economy picks up again before we have any more increases.”
The increase follows deals Time Warner made with a local TV station and program supplier that raised its costs. An ongoing disagreement with Channel 4’s owner, LIN TV, kept the Buffalo Bills off the air for almost a month, while Viacom threatened last week to pull its numerous cable channels, including Comedy Central, MTV and VH-1, before a settlement was reached.
The rate increase angered Council Member Brian Davis. He said East Side subscribers in his district have had cable problems since Christmas that have yet to be corrected.
“Time Warner hasn’t done anything to address that concern at the same time they’re increasing rates, which, of course, amazes me to see that,” Davis said. “I don’t think they should be talking about rate increases.”
Starting Feb. 1, broadcast basic service goes up $1 a month to $10; standard basic service rises $3.45 to $61.14; digital basic slides upward $4 month to $63.95; and DVR service jumps $1 to $7.95.
The All the Best program that combines digital cable, high speed Internet and phone service will climb $6 to $125.95. The phone and cable package and the Internet and cable package will rise $6 to $95.95, and the phone and Internet package will also increase $6 to $80.95.
Subscribers to those packages can keep 2008 rates by signing up for the price lock guarantee program by the end of January. The program requires a two-year commitment.
“We have added many new services. Of course, our biggest expense is for programming. While we fight to keep the costs down, we still think we provide a great entertainment value,” Wolfgang said.
Glenn Britt, president and chief executive officer of Time Warner, issued a statement before Time Warner made last week’s deal with Viacom explaining the company’s need to raise prices.
“Huge price increases — like what Viacom is demanding — threaten the ultimate value of cable TV. Time Warner Cable is a retail distributor of products we purchase wholesale. Wholesale programming costs are rising dramatically every year, and, like all multichannel distributors, we have to pass on at least a portion of the increases to our customers,” Britt said.
“Viacom’s MTV Networks are just a few of the hundreds of channels we carry,” he continued. “If every channel demanded huge, double-digit increases like what Viacom is trying to force our customers to pay, it would be impossible to keep the price of cable reasonable for our customers.”
Of course, Time Warner’s definition of what is reasonable may differ from that of its subscribers.
“I don’t like it,” Barbara O’Connell said of the rate increase as she stood outside the Time Warner building. “I don’t like that all the costs are going up, and people’s money just does not keep up.”
Martha Oliveras said she was closing out her account to switch to DirecTV.
“[The increase] bothers me, it really does, especially the way things are nowadays. The economy is so bad,” Oliveras said.
Although no one likes cost increases, Time Warner had a defender in subscriber Aubrey Beathley.
“Everybody else is raising their rates, so why shouldn’t they? I don’t like rate increases for anything, but businesses got to stay on top some kind of way,” Beathley said.
Time Warner is expected to premiere a new 24-hour news channel in Western New York in coming months, providing local programming that satellite services like DirecTV and DISH and Verizon’s new FiOS service don’t offer. It will be in addition to Time Warner SportsNet, which produces local coverage of high school and collegiate sports events.
It also is promoting other features exclusive to cable, like the new “start over” that allows subscribers to watch certain shows from the beginning if they came in late.
apergament@buffnews.com and msommer@buffnews.com
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