|
AT&T hikes cable prices
|
 |
January 2, 2001: 11:14 a.m. ET
Citing rising costs, cable operator lifting prices by average 4.8%
|
NEW YORK (CNNfn) - AT&T Corp.'s cable television unit Tuesday announced plans to raise its monthly rates an average 4.8 percent, and some by as much as 6.55 percent, due to rising costs of providing the service.
AT&T's (T: Research, Estimates) AT&T Broadband unit, the leading U.S. cable television operator with about 16 million customers, said those who receive its main analog package, known as Standard Cable, will see prices increase 4.3 percent, starting in February.
The package, which typically offers customers the regular broadcast networks as well as cable networks such as The Weather Channel, ESPN and MTV, is received by 63 percent of the company's customers.
 For those with "expanded" service -- about 11 percent of all customers -- prices will increase by about 6.55 percent.
AT&T Broadband also sells services such as digital cable, high-speed cable Internet services and competitive local phone service.
A company spokeswoman said there will be no increase in prices for its digital cable service, which provides hundreds of channels including sports, movies and children's programming.
She added that the price changes would be accompanied by other moves -- such as scheduling adjustments -- meant to consolidate cable systems AT&T acquired in recent years, including properties formerly controlled by TCI and MediaOne.
Higher costs, particularly for sports programming
AT&T Broadband attributed its price changes to the costs of providing cable services -- including programming, technical upgrades that improve the reliability and quality of multi-channel video services, and investments in customer service.
The company pays fees to programmers for the rights to distribute shows. Such fees will increase by 10 percent in 2001, with fees for sports programming accounting for the largest portion of the increase.
Some systems will increase equipment and installation prices in February, but most of these prices will change later this year, based on Federal Communications Commission guidelines, the company said.
Shares of AT&T rose 50 cents to $17.75 in morning trade Tuesday.
Last month, in a warning about fourth-quarter earnings and revenue, New York-based AT&T said data and Internet revenue will maintain its third-quarter growth rate of more than 20 percent, and that its Broadband unit is expected to deliver fourth-quarter growth similar or slightly better than its third-quarter rate of 10.8 percent.
The price change mirrors a similar move by Time Warner Cable, a key rival of AT&T Broadband, and a unit of Time Warner Corp. (TWX: Research, Estimates), which is also the parent of CNNfn.com. In December, Time Warner Cable units in certain markets, including New York City and Columbia, S.C., announced price increases of about 5 percent.
A Time Warner spokesman said regional cable operators typically set rate adjustments each December or January. 
|
|
|
|
|
|
AT&T Cable Services
|
Note: Pages will open in a new browser window
External sites are not endorsed by CNNmoney
|
|
|
|
 |
|
.
