$1.99 each per month… every month.

Comcast customers in parts of Minnesota are receiving notification their cable lineup is about to switch to “all-digital,” requiring most to rent Comcast-supplied digital cable set-top boxes that will add at least $1.99 per box, per month to customers’ bills.

Residents in Eagan are so upset, a special meeting has been scheduled tonight by the Eagan City Council to discuss the burgeoning cable fees from the largest cable provider in the state.

“What we’ve decided to do is try to gather more information on behalf of our residents,” Eagan communications director Tom Garrison told the Eagan Patch. “I think people are certainly hearing about it. They’ve got questions, they’ve got mailings, and we hope to get them good and useful information they can act on.”

Comcast is in the process of reclaiming space on its cable systems by switching analog television channels to digital service, which will free up considerable bandwidth for other uses. But customers are inconvenienced if they do not already have Comcast set-top boxes.

Comcast has notified customers they can have a Digital Transport Adapter (DTA) sent to them for $1.99 per month, per adapter. The device makes digital signals available in analog so customers can keep watching. But the equipment no longer is provided for free. Customers will have to either install a DTA, a traditional set-top box, or a CableCARD on every television in the home after the conversion is complete.

Although the city will meet with interested residents, local government officials have very little say over how Comcast chooses to conduct business and cannot force the company to change its plans.

Comcast is introducing a new $1.99/month fee for equipment that allows customers with older televisions to watch the cable television lineup they already pay to receive.

Customers with Digital Transport Adapters, also known as DTAs, will soon find the new fee on their Comcast bill. Comcast formerly offered up to two DTA boxes for free in areas where the company reclaimed space on cable systems by moving analog television channels to digital. Customers needing more than two boxes paid $1.99 for each additional box, but now Comcast will charge everyone for the devices.

Comcast expects to earn more than $550 million in new revenue nationwide from the introduction of the new fee.

Customers are unhappy.

“So after paying more than $60 a month for a television package, we now have to shell out even more for the equipment to watch it,” asks Stop the Cap! reader Deepak in Philadelphia, one of the first cities where Comcast will levy the fee. “Comcast says we cannot buy our own box or buys theirs outright to avoid paying the fee either.”

The devices cost Comcast an estimated $35-50 each, depending on their capabilities, so Comcast will book the additional revenue as profit as early as mid-2014.

Time Warner Cable customers in southern California are bracing themselves for a rate increase that will raise prices by 8.2 percent — almost four times the rate of inflation.

The price for digital basic cable, the most popular cable television package, will rise from $67 to $72.50 per month. The price charged to record shows from that package is also going up. “DVR service,” which does not include the DVR equipment itself, is rising 18.6% — from $10.95 to $12.99 a month.

Stop the Cap! reader Steve in Carlsbad adds his rate increase notification also mentions price increases for bundled packages:

All Standard and Basic packages and bundles will increase by $5.00 and all digital video packages and bundles will increase by $3.00.

The rate increases are by no means over. As Time Warner mails its price change notifications for 2013 to customers, it also signed a 25-year deal with the Los Angeles Dodgers for yet another regional sports channel showcasing the baseball team. Industry insiders estimate the deal is worth between $7-8 billion and could eventually cost cable subscribers an additional $5 a month, whether they watch the channel or not.

It is likely the latest rate increase does include the cost of the 2012 launch of Time Warner Cable SportsNet, which features the Los Angeles Lakers. Time Warner asks competing satellite and telephone company video services to pay between $4-5 a month to provide SportsNet to their customers.

The rate increases will not affect customers on retention or promotional packages until they expire. As usual, Time Warner blamed the rate hike on increasing programming costs, notably for sports and broadcast television stations.

Although many Californians have alternatives, ranging from AT&T U-verse to two satellite television providers, those companies are raising prices as well:

• Comcast (San Francisco Bay area) rates went up 4.3% last year and will increase again this summer;
• DirecTV rates will increase Feb. 7 by about 4.5 percent;
• Dish Networks’ most popular packages rose $5 a month on Jan. 17;
• AT&T U-verse will boost prices on components of its service by around $2 a month each on Jan. 27.

Customers facing price increases can use the rate increase notification as the trigger to threaten to cancel service to win a lower price with a customer retention offer. Stop the Cap! published a comprehensive guide on how to win a lower rate from Time Warner in 2012 and those tips are still working for our readers today.

If Time Warner seems unwilling to bargain, customers can also consider taking their business elsewhere by signing up for a promotional introductory offer with a competitor. When that offer expires, Time Warner will take you back with a new customer promotion as well.

In general, bundling all of your services with one provider will save the most money. Triple play packages consisting of television, broadband, and phone service are the most economical when considering the cost of each service. But it is also a good idea to consider whether you need all three services.

The weakest link of the triple play package is the landline. If you subscribe to broadband and cable service, consider switching to a broadband-based phone company like Ooma, which received a high rating from Consumer Reports. After an initial investment of around $150 for the equipment, the price of the phone service itself is next to nothing and includes nationwide unlimited calling. Ooma basic customers only pay for FCC-mandated fees and local taxes and surcharges. Combined these are usually well under $7 a month. Ooma Premier customers pay $119.99 a year and get a free number transfer, free calling to Canada, the choice of a Bluetooth Adapter, Wireless Adapter or Extended Warranty, a large list of calling features, a second line, voicemail, and free mobile calling minutes.

This digital adapter cable box is free through 2015. A traditional set top box from Time Warner costs $8.49/mo.

Next consider your current cable television package. Scrutinize your bill for add-on fees, especially for digital/HD add-on packages for channels you may never watch. Do you still need to pay for HBO, Cinemax, Showtime, and Starz? Consider Netflix, Redbox, and Amazon video — among others — to satisfy your movie needs without paying more than $15 a month for HBO alone.

Equipment fees may also make up a substantial portion of your bill. If you pay separately for DVR equipment and service, you are probably paying Time Warner’s regular customer rates. Seize the opportunity to demand a better deal. Customers with multiple set top boxes may want to consider ditching them on secondary sets, especially if they don’t need an on-screen program guide or access to on-demand programming.

Time Warner is offering customers “digital transport adapters” (DTAs) at no cost through 2015. These boxes, a fraction of the size of a traditional set top box, will allow older sets to access most digital channels that are included in your cable television package. But a DTA won’t work with on-demand programming or premium channels, at least for now. The devices also do not support a handful of digital channels that Time Warner provides under a bandwidth-saving scheme that only delivers a network if a customer with a traditional set top box actually starts to watch. In western New York, we found about 10 unavailable channels, virtually all very minor networks that won’t prove much of an inconvenience. Using a DTA instead of a set top box can save up to $8.50 a month for each cable box it replaces.

If you subscribe to Time Warner Cable broadband and are paying the company’s $3.95 a month modem rental fee, you are throwing your money away. Invest in purchasing your own cable modem. They are simple to install and are reliable. You’ll earn back the purchase price in as little as a year. Now may also be a good time to review your speed needs. Time Warner recently boosted its standard broadband speed to 15/1Mbps. If you pay extra for Turbo, this might be a good time to consider dropping it if you don’t need the incrementally faster 20Mbps download speed Turbo offers.

Eight channels are missing from Raleigh-area televisions.

Time Warner Cable dropped eight analog channels from its lineup in Raleigh recently, advising customers they will need either a digital transport adapter (DTA) or standard set top box to get those channels back.

But one Raleigh customer tells Stop the Cap! those DTA boxes are hard to come by at the moment, forcing some to get costly set top boxes instead.

“We have been told three times by Time Warner Cable there is a multi-week wait for the free boxes, but we can get all the set top boxes we want today, for more than $6 a month each,” complains Rachel, who has three TV’s that need a box solution. “You think they would have waited for enough equipment before they took the channels away.”

Now missing from the analog lineup: C-SPAN, CMT, Oprah Winfrey Network, VH-1 Classics, Discovery Fitness & Health, Lifetime Movie Network, TruTV and the Golf Channel.

Jim DuBreck thought he had nothing to worry about when Time Warner sent him a postcard alerting him those eight channels were only going to be available in digital starting this month. He told ABC11 he already has a digital TV. Time Warner did not tell him that was not enough to keep watching.

DuBreck later learned the cable company not only converted the channels to digital, it also encrypted them. His digital TV would still need either a set top box or DTA. Only he is still waiting for the five DTA boxes for his own televisions.

Time Warner told the station they have seen a much higher demand than anticipated for the adapters. So, there may be some temporary delays before receiving one. DTA boxes are free for two years, set top boxes are not.

Customers better get used to it. Time Warner is gradually converting their systems to digital lineups, so as time goes by, more analog channels will disappear.

Time Warner Cable explained why:

“Moving analog channels to digital frees up capacity in our network to bring customers faster internet like we just did last week when we boosted the speeds of our standard internet service by 50 percent. Providing channels digitally also allows us to offer customers more because it’s dramatically more efficient: We can deliver up to four HD channels, or as many as 12 standard-definition digital channels, using the same capacity as it takes to carry one analog channel.”

[flv width=”600″ height=”358″]http://www.phillipdampier.com/video/WTVD Raleigh Cable customer upset over Time Warner changes 12-14-12.flv[/flv]

WTVD in Raleigh helps Time Warner Cable customers understand where some of their analog channels are going.  (3 minutes)

The Federal Communications Commission has granted cable operators permission to completely encrypt their television lineups, potentially requiring every subscriber to rent set top boxes or CableCARD technology to continue watching cable-TV.

The FCC voted last week 5-0 to allow total encryption, a reversal of an older rule that prohibited encryption of the basic tier, allowing cable customers to watch local stations and other community programming without the expense of extra equipment.

The cable industry said the decision is a victory against cable theft, claiming that nearly five percent of all cable television hookups are illegally stealing service, at a cost estimated at $5 billion in lost revenue annually.

But some third party companies offering alternatives to costly set top boxes with endless monthly rental fees claim the industry move towards encryption is more about protecting the cable monopoly than controlling signal theft.

Current licensing agreements do not allow third party set top manufacturers to support scrambled channels without an added-cost, cable company-supplied set top box or card. That means a would-be customer would have to invest in a third party set top box and a cable company-supplied set top box to manage scrambled channels. That may leave customers wondering why they need the third party box at all.

This presented a problem for Boxee, which manufactures third party set top boxes, some with DVR capability. If cable systems completely encrypt their lineups, Boxee customers will need to rent a cable box and work through a complicated procedure to get both to work together.

Boxee officials suggest both an interim and long term solution to the dilemma — both requiring the goodwill of the cable industry to work out the details.

For now, Boxee and Comcast have agreed to work together on an HD digital transport adapter (DTA) with built-in Ethernet (E-DTA). A Boxee user would then access basic tier channels directly through an Ethernet connection and change channels remotely using their enhanced set top via a DLNA protocol.

A longer term solution would be to create a licensing path for an integrated DTA solution included inside third party set top boxes. This would eliminate the need for an added cost E-DTA box.

Cable operators planning to encrypt their entire television lineup will soon begin notifying customers of their plans. Under an agreement with the FCC, those with broadcast basic service will get up to two boxes for two years without charge (five years if the customer is on public assistance). Those who already have a cable box or DVR will get one box for two years at no charge. The cable company can impose monthly rental fees on additional boxes and begin charging for every box after two years.

Former FCC chairman Michael Powell, who now presides over the nation’s largest cable lobbying group, called the FCC decision “pro-consumer” despite the added expense and inconvenient many customers will experience.

“By permitting cable operators to join their competitors in encrypting the basic service tier, the commission has adopted a sensible, pro-consumer approach that will reduce overall in- home service calls,” said Powell, president of the National Cable and Telecommunications Association. “Encryption of the basic tier also enhances security of the network which reduces service theft that harms honest customers.”

Comcast is a leading proponent of total encryption, because it would allow them to start and stop service remotely, without having to schedule a service call to disconnect service. Cablevision already encrypts its entire lineup in certain areas under a previously-obtained waiver from the FCC. The company said it saved money reducing labor costs associated with service calls to physically connect and disconnect service.