Martin Slams Cable on Pricing, Bundling

FCC chairman backs Consumers Union complaints to Congress about cable industry

FCC Chairman Kevin Martin took the opportunity of a letter to Congress from Consumers Union to hammer the cable industry over rates and put in yet another plug for a la carte, at least obliquely, and using the tanking economy to drive home the point.

In a statement commenting on a letter from the consumer group to the Senate Commerce Committee about cable systems moving channels out of their analog packages and onto the digital tier, Martin said they had it right.

"We agree with Consumers Union. Over the last decade average cable rates have more than doubled," he said in a statement Wednesday afternoon. "And now cable companies are charging consumers more but consumers are receiving less.

"We have also received complaints that cable companies are moving channels to a digital-only tier and charging consumers the same monthly rate for a reduced number of channels.  If consumers wish to continue watching the same channels that they were before, they must now buy a more expensive package or rent more expensive equipment. This is an unfortunate trend for families facing increasingly difficult economic times."

The National Cable & Telecommunications Association saw it differently. Calling the group "off base," NCTA said: "CU completely misses the real reason that more consumers are enjoying digital cable – because it provides a valuable and diverse range of programming, high-definition video and interactive services that the entire family can enjoy.  During today’s tough economic climate, the significant price savings offered by cable’s triple play bundle of video, broadband and phone service is even more valuable to consumers."

NCTA said it would have more to say on the issue.