Cable One has the highest average revenue per customer of any publicly traded cable company in the United States, with the average customer paying Cable One $70.80 a month, mostly for internet access.

The company’s first quarter earnings growth of 5.5% reflect the company’s recent price increases and regime of low-allowance data caps, which have pushed 10 percent of its customers to pay an extra $40 a month to bring back unlimited access. Others are upgrading to costlier, faster tiers with more generous usage allowances.

“During the first quarter, we saw roughly 50% of our new customers choose our 200 Mbps or higher speed service and nearly 10% of our new customers opted to purchase our unlimited data plan,” said Julia Laulis, Cable One CEO.

Laulis

Cable One’s 200 Mbps plan (with a 600 GB data cap) costs $65 a month after promotions expire. A DOCSIS 3.0 modem lease fee of $10.50 applies. A $2.75 monthly internet service surcharge may apply. If a customer wants unlimited access to avoid overlimit fees, there is an additional charge of $40 a month (a 5 TB cap applies to the “unlimited plan”). Customers choosing a 200 Mbps broadband-only package with unlimited data will pay up to $118.25 a month.

Cable One’s broadband customers are concerned about staying within the data caps to avoid overlimit fees. While Comcast and Charter Spectrum customers consume over 300-400 GB of data per month (Comcast has a 1 TB cap, Spectrum only sells unlimited service), Cable One customers use an average of 290 GB, with usage growing at a 30-35% annual rate. Many Cable One customers have little choice either. Laulis noted that Cable One’s DSL competition is not very relevant when customers want to watch streaming video. Speeds are often so slow, customers do not have a good experience streaming HD video over DSL.

Cable One is also shedding its video customers in record numbers, with just 305,000 of its cable TV customers left. More than 29,000 departed year over year, and that number continues to rise as consumers rebel against the company’s high prices and unwillingness to negotiate.

MoffettNathanson warned that Cable One’s high pricing may eventually price itself out of broadband growth, as consumers elect to sign up with telephone companies instead. But many of its service areas are still served by low-speed DSL, and despite Cable One’s high cost, the company added 10,600 new internet customers in the last quarter.

In addition to raising prices, the company also plans to spend between $9-11 million to change its name from Cable One to Sparklight over the next two years.

The top 10 service providers in the United States collectively lost over 1.25 million paid television customers in the first three months of 2019, providing further evidence that cord-cutting is accelerating.

Multiscreen Index estimates if that trend continues, an average of 14,000 Americans cancel their paid cable or satellite television service daily.

AT&T suffered the greatest losses, primarily from its satellite television service DirecTV. More than a half-million satellite customers canceled service in the first quarter of the year. AT&T lost another 89,000 streaming customers as news spread that the service was increasing prices and restricting generous promotions to attract new subscribers. DISH Network, DirecTV’s satellite competitor, also lost more than 250,000 customers.

Many cable television providers announced this quarter they would no longer fret about the loss of cable TV customers, and many have dropped retention efforts that included deeply discounted service. As a result, customers are finding it easier than ever to cancel service. Comcast lost 107,000 TV customers, while Charter Spectrum lost 152,000. Spectrum recently increased the price of its Broadcast TV Fee to $11.99 a month and has pulled back on promotions discounting television service.

“There were losses across the top 10 television services in the United States, with even the DirecTV Now online service losing customers following previous heavy promotion. Between them, they lost over one-and-a-quarter million subscribers in three months. They still command a significant number of customers but the rate of attrition has increased,” said Dr. William Cooper, the editor of the informitv Multiscreen Index.

The total figures for the quarter show roughly 81.90 million Americans are still paying one of the top-10 providers for cable or satellite television service, amounting to less than 70% of television homes — a significant drop. Privately held Cox Communications is excluded because it does not report subscriber numbers or trends.

Verizon’s FiOS expansion is still, still, still, still, and still dead.

Despite the passage of favorable legislation deregulating the state’s largest telecom companies, Verizon has thumbed its nose at New Jersey’s efforts to convince the company to expand its fiber-to-the-home service.

“Verizon does not plan to expand its FiOS service footprint,” wrote Tanya Davis, a Verizon franchise service manager for FiOS in New Jersey and New York. “The company remains focused on continuing to meet its franchise obligations, and delivering competitive services, and enhanced consumer choices, where the services are available.”

More than a decade after passing the 2006 Cable TV Act in New Jersey, designed to convince telecom companies to compete more vigorously with each other, Verizon remains uninterested in further expanding its fiber network in New Jersey and beyond.

After successfully lobbying the state to adopt a statewide cable TV franchise policy, making life easier for Verizon by not requiring the company to negotiate a contract with each town serviced, Verizon suddenly stopped caring after announcing a pullback in further FiOS expansion in 2010. The change in heart appears to have started at the top. Then CEO Ivan Seidenberg, who approved FiOS, retired and was replaced by Lowell McAdam, who preferred Verizon invest mostly in its wireless networks.

Vergano

As a result, New Jersey has a telecom industry-friendly deregulatory policy in place with nothing to show for it.

“People want to see competition,” Wayne Mayor Christopher Vergano told the North Jersey Record, citing complaints his office has received about Altice USA’s Optimum service. “Over the years, they’ve seen their cable bills increase. We’re trying to give residents options.”

Wayne’s Township Council passed a resolution asking state lawmakers to review the 2006 Cable TV Act to find a way to coerce Verizon to do more fiber upgrades in the state. In 2006, then Gov. John Corzine got Verizon to commit to wiring 70 towns across New Jersey, and Wayne was not one of them.

Verizon agreed to expand its fiber network to all county seats, as well as areas with a population density in excess of 7,111 residents per square mile.

New Jersey’s Board of Public Utilities (BPU) is still allowed to report on Verizon’s progress, but little else, thanks to deregulation. A BPU report stated deployment of FiOS slowed to a crawl between 2010-2013, when only three new towns were reached with fiber upgrades. What little interest Verizon still had in FiOS expansion ended after 2012’s Superstorm Sandy, after which Verizon ended expansion in urban areas of New Jersey as well.

“It’s solely Verizon’s discretion to add municipalities to its system-wide franchise,” a BPU spokesman told the newspaper.

Prior to deregulation, utility boards and regulators could compel companies to offer service instead of shrugging their shoulders and telling state lawmakers ‘it’s all up to Verizon.’

Your time is up. It may have been one, two, or if you are especially lucky — three years since you signed up for Charter Spectrum service. But your temporary reprieve from the high price of cable is over.

The bad news arrives in a letter:

Thank you for being a Spectrum customer. When you signed up for your services, you received a promotional discounted rate on your bill. This promotion is coming to an end. However, as a valued customer we are pleased to offer a new promotion for an additional year.

Spectrum certainly is pleased. You may not be. To avoid shocking you too much, the company does not provide a new “out the door” price. They wait until they send you your first post-promotion bill. The letter also does not remind you what you were paying, it breaks out the price of each component service of your bundle for the following 12 months in an effort to lessen the surprise.

For most Spectrum customers on a basic, new customer promotion lasting one year, the rate change is substantial — once you add it all up.

For a customer subscribed to Standard Spectrum TV with two DVR boxes, Internet Ultra (400/20 Mbps), and Spectrum Voice, here is what you can expect (prices and promotions may vary):

• Standard Spectrum TV: Your promotional rate of $54.98 will rise to $86.97, an increase of $31.99.
• Internet Ultra: The promotional triple-play bundled price of $54.99 increases to $74.99, up $20.
• Spectrum Voice: The bundled price of $29.99 will decrease to $19.99, a savings of $10.

Spectrum Voice, Charter’s digital home phone line product, is the most vulnerable part of their triple play bundle. Scores of customers drop landline service at the end of a promotion because, in many cases, having the landline as part of a triple play package either came free (or almost free), or actually reduced the price of the bundle. By offering a lower rate going forward, Charter is making a token effort to convince customers not to abandon voice service, but as the company’s landline disconnects continue to accelerate, it clearly isn’t an effective tactic.

The letter also ignores Charter’s ever-rising Broadcast TV Fee, now $11.99 a month, and is compulsory for all cable TV customers. So the old monthly promotional rate of $155.75 for this particular package will rise to about $193.94, a difference of $38.19 a month. After a second 12 months, prices generally reset even higher to the published “rack rate.”

Since Charter took control of Time Warner Cable and Bright House Networks, efforts by customers to negotiate a lower rate got much tougher, but the company’s customer retention efforts have stepped up slightly over the last year. You should still expect to pay more than you did before, but it is often possible to negotiate a slightly better deal by threatening to cancel service. Some customers report more success discussing the matter in a Spectrum cable store, cable modem and set top boxes in hand. But do not be surprised if they shrug their shoulders and agree to your request to cancel your account on the spot. Spectrum, like many cable companies, has gotten pickier about who they offer promotions to, and are willing to say goodbye to barely profitable customers, especially those only subscribed to cable TV.

For the last several years, cable subscribers have lamented that the advertised price of service falls short of the real “out-the-door” cost shown on one’s monthly bill.

Charter Spectrum is one of the worst offenders, having avoided to mention in its advertising the spiraling-upwards “Broadcast TV Fee,” applied without exception to cable television customers’ bills.

The “Broadcast TV Fee,” (recently increased to $11.99 a month) is compulsory for cable TV customers and subject to change, regardless if you have a “rate guarantee” with Spectrum or not. The fee is the same for new and old customers, regardless of any promotion, and it has not been well-disclosed in Spectrum’s print and online advertising. Only customers subscribing to one of Spectrum’s new streaming TV packages will get a break. One of Spectrum’s most advertised stream-only packages applies a $5/mo Broadcast TV Fee, less than half of what Spectrum charges traditional cable TV customers for the same local stations.

As of this month, Spectrum.com now includes the fee on its price quote system for customers looking for an estimated cost of service. It adds enough to put the monthly cost of cable TV above $60 for new customers (including the rental cost of one, now-mandatory, HD-set top box), despite the fact Spectrum advertises a rate of $44.99/mo for the first year of service. This reality might further aggravate cord-cutting or “cable-TV nevers” from considering bundling television service with Spectrum.

For its part, Spectrum explains the fee represents “a fee by the owners of local broadcast ‘network-affiliated’ TV stations (affiliates of CBS, NBC, ABC, Fox, and so on). This fee enables Spectrum to continue to offer these channels for our customers.”

But in fact, it is just another cost of doing business. Cable programmers also charge similar fees, and some — notably ESPN — charge more than many local stations do for cable carriage. Cable operators are trying to make a political statement about the high cost of cable carriage of local TV stations that viewers can watch for free over-the-air. But they are also trying to hide the true cost of cable television, sensitive to the fact many customers are reaching their limit on bloated TV packages of hundreds of expensive channels that mostly go unwatched. Sticker shock can only worsen cord-cutting and cause more to rule out new subscriptions to cable television, especially as cable operators continue to raise the price of broadband internet service at the same time.