Cable, Internet bills going up in the New Year

This won’t help your New Year’s Day hangover: Cable and satellite TV bills are going up in January.

Time Warner Cable, AT&T and DirecTV are among the providers bumping up prices next month, citing increased programming costs and expensive technology upgrades.

The price increases vary by provider and service plans but could add a few dollars – or more – to many monthly cable and Internet bills around Charlotte.

“It’s just another round of increases that have been going on year after year since the industry began,” said industry analyst Jeff Kagan.

The move comes even as cable providers worry about losing customers who abandon traditional TV services for less expensive streaming services such as Netflix and Hulu. It also comes as Google Fiber is building out a network in Charlotte that will create another Internet and video competitor.

About 15 percent of adults now qualify as “cord cutters,” meaning they previously had cable or satellite TV but no longer do, according to a Pew Research Center survey this month. About 71 percent of those without cable or satellite said they don’t subscribe to these services because they are too expensive, while 64 percent say they can access the programs they want with over-air antenna, the Internet or streaming services, according to the survey.

Cable providers “have a big threat, and they’re not handling it well by raising prices, because that will chase more customers away,” Kagan said.

Cable and Internet providers are also dealing with perennial complaints about their customer service. In a study this June, cable and Internet were once again the lowest scoring of all 43 consumer categories surveyed by the American Customer Satisfaction Index.

Among the major providers in the Charlotte area, AT&T said its U-verse TV customers will see an increase of around 5.7 percent, or $6.05 per month, starting Jan. 28. Satellite TV provider DirecTV, now owned by AT&T, is also raising prices by about 5.7 percent, or about $6.40 per month. Prices for Internet service aren’t changing.

AT&T said the price changes are affected by factors that include programming costs, service improvements and technology enhancements.

“Programming costs constitute a significant portion of the costs that we and our customers pay,” the company said. “These adjustments to our package prices are significantly lower than the increases our programmers are charging for their content.”

Time Warner Cable, the largest area cable provider with 480,000 customers, is also boosting prices.

Starting Jan. 16, Time Warner Cable is raising two surcharges that it adds to bills. The broadcast TV fee will increase $1 to $3.75 per month, and the sports programming surcharge goes up $2.25 to $5 per month.

In addition, customers who lease cable modems from the company will see the price increase $2 to $10 per month. Customers can avoid this fee by buying their own modem.

Time Warner Cable said there’s no change in the monthly price of double- and triple-play packages that bundle TV, Internet and phone services. The vast majority of customers pay for services this way.

Here are some other Time Warner Cable changes:

▪ The cost of the sports pass, which provides additional sports channels, will go up $1.01 to $10 per month.

▪ The cost of set-top box prices will be largely standardized at $11.75 per month, and the company is eliminating a $1.50 per month digital outlet fee. Depending on the market, the changes will mean the price will stay about the same or slightly decrease, while in other cases bills will increase as much as $1.50 per month.

▪ Some customers who pay individually for video or Internet plans may see an increase of up to $3 for their video plan or $2 for their Internet plan. Time Warner said it hasn’t increased the price of Internet plans since Jan. 2014 and noted it isn’t changing the price of its “Everyday Low Price Internet” offering, which costs $14.99 per month.

The increases come after a year in which Time Warner Cable rolled out in Charlotte its high-speed TWC Maxx Internet service, which boosted speeds as much as six times. This year, the New York-based company also saw its sale to Comcast fall through before turning to another suitor in Charter Communications. That deal is still under regulatory review.

Time Warner Cable said the new prices reflect the company’s “continued investment in the performance and reliability of our networks and equipment, along with the rapidly rising costs of programming, especially local broadcast channels and cable sports networks.”

The company said it has deployed more than 5 million new set-top boxes and advanced modems this year and has invested nearly $500 million in its networks and equipment in the Carolinas region.

Time Warner Cable also said it needs to raise prices because the amount it pays for broadcast TV and sports programs has been going up. For example, the per-customer cost of local broadcast channels is up 85 percent since 2013, it said. The price increases for customers cover some, but not all, of the company’s higher expenses, Time Warner Cable said.

The increases come as Google Fiber continues to build out its network in Charlotte. The technology giant announced plans to come to the city in January 2015 but hasn’t said when it will start offering service. It has urged customers to be patient as it lays thousands of miles of fiber around the city.

In advance of Google’s arrival, both Time Warner and AT&T have been increasing the speeds of their Internet offerings.

Google’s arrival “will shake up the market,” Kagan said. “We’re going to see more companies offering faster Internet service because tomorrow it’s all about the Internet.”

This story was originally published December 30, 2015 at 3:53 PM with the headline "Cable, Internet bills going up in the New Year."