Watching your favorite television show on EPB's Fi-TV connection will cost you anywhere from $1 to $8 more a month, starting in November.
EPB directors Friday approved the increases in its cable TV rates to cover higher video programming expenses charged by local television stations, broadcast networks and and cable programmers. The increases will become effective Nov. 1 for more than 54,000 video service customers of EPB.
The city-owned utility said it will not raise its prices for its high-speed internet, telephone or premium TV services.
EPB raising rates
› Fi-TV Bronze Select, 20 networks with standard features package with 1 set top box, current monthly rate of $22.98 rises $1 to $23.98 a month*
› Fi-TV Silver Select, 93 networks with standard features package with 1 set top box, currently monthly rate of $87.98 rises $6 to $93.98 a month*
› Fi-TV Gold Select, 160 networks with 50 music channels and nearly 12,000 video on demand titles, plus standard features package with 1 set top box, currently monthly rate of $103.98 rises $8 to $111.98 a month*
*Does not include taxes or fees or discounts available for bundled options
"Most all of our program channels, from local stations to cable news, sports and entertainment channels, all have contractual agreements to raise their prices each year and we're simply passing those along," said Greg Eaves, EPB's chief financial officer.
EPB President David Wade told the utility board Friday that EPB must boost its video rates or risk losing money on the service, which EPB as a publicly owned and regulated utility is not allowed to do. EPB will be sending letters to affected customers next week explaining the changes and Wade said EPB customer service representatives will be available to discuss different options for consumers who may wish to alter their video services due to the higher rates.
"We want to do what is best for our customers," Wade said, noting that many customers are abandoning standard cable TV plans and moving to streaming television services such as Hulu, Sling TV, Netflix or Amazon through their internet.
EPB has signed up more than 99,000 residential and business customers to its fiber optic network since the electric utility expanded into telecom a decade ago. But only 54,014 of those customers subscribe to any of EPB's video service. The rest used EPB strictly for for internet, data or phone service.
Despite its "drive to 100k" program to sign up more EPB fiber optic users, the number of video service users at EPB dropped by more than 2,200 in the past year, Eaves said. The decline reflects the growing trend by many TV viewers to "cut the cord" for cable TV services and switch to over-the-air broadcasts and internet video services.
Wade said EPB actually makes more money from internet services than its video business, even though the $60 million-a-year video services generate nearly half of EPB's fiber optic revenues.
Most of EPB's video service customers subscribe to the "gold plan" and will pay $8 more a month, or $96 more a year, under the higher prices approved Friday.
The latest EPB rate hikes are slightly lower than those adopted over the past couple of years by EPB, which last year raised cable TV plans from $2 to $11 more a month. EPB has raised its video rates for each of the past five years to cover increased program expenses, Wade said.
Such raises in video charges are common by most cable TV providers, although internet service rates have generally remained stable or even declined.
The U.S. Bureau of Labor Statistics said the average consumer bill for cable and satellite subscriber services rose 5.6 percent in the 12-month period ended in August, or double the 2.8 percent overall producer price inflation rate in the same period.
The price of internet access services dropped by an average 1.1 percent in the same period, according to BLS data.
EPB's biggest rival for cable TV service in Chattanooga, Comcast, has no immediate plans for a rate increase, Comcast spokeswoman Sara Jo Walker said Friday.
But in a June report on "Cable TV's Sneaky Fees," Consumer Reports magazine said many cable providers, including Comcast in some areas, have added broadcast TV fees, sports surcharges and HD technology fees on to bills while keeping the quoted plan rates unchanged. Consumer Reports delivered more than 100,000 petition signatures to Comcast three months questioning the add-on fees.
"With the proliferation of add-on fees, it's nearly impossible for consumers to find out the full cost of a cable package before they get locked into a contract — and cable companies count on this," said Jonathan Schwantes, senior policy counsel for Consumers Union, the advocacy division of Consumer Reports. "These confusing, often misleadingly named charges, continue to drive up consumer bills, even if you lock in a promotional rate."
Wade said EPB is trying to be transparent with its rate increase. Consumer Reports recently praised EPB as "one of the few bright spots for internet service" and the only Internet Service Provider to receive the magazine's top mark for value.
Contact Dave Flessner at firstname.lastname@example.org.