Soon the 15 million customers that are watching sports and enjoying the cable service of Time Warner will endure a price increase. Subscribers will pay a new $2.75 per month fee for sports programming as well as an increase in modem leasing from $5.99 to eight dollars per lot. Also subscribers who are not taking advantage of a "bundle" to get his movie channels may see additional cost increases. For example the HBO movie channels will increase from $14.99 to $16.99 per month. Package deals will not be increased and order to maintain their competitive advantage
It is important note that customers who only use Time Warner for Internet services will not be affected by the broadcasting fee increases however produce reasons the motor leasing fee increase will still apply.
It is no surprise that Time Warner had to increase its pricing. After investing millions in new hardware in order to support faster Internet speeds, and a merger with Comcast that came in at a healthy $45 billion customer should expect at least some of the cost increase the pastor to them. The question becomes is the increase fair?
It is important to note in the "fairness factor" that there is no way to opt out of the sports programming fees, even if you don't watch sports. Most networks carried by Time Warner cable will not allow channels to be offered on an à la carte basis.
It is important to note that the cost to Time Warner for carrying local sports has gone up by 91% since 2008, and the provider has also seen an increase in the cost to show local channels by 60% over the last two years. These levels of increase have certainly never passed through to the customer, and if they did they wouldn't have 50 million customers for very long.
Most expensive channel for any cable or satellite provider to offer his ESPN. Sports television providers are charged $6.04 a month per customer. This is almost 6 times that of the next most expensive channel which is GMT at $1.44 per customer. The NFL network comes in at number three with $1.22 per customer. Also remember this doesn't include ESPN2 which brings an additional $.76 per customer or Fox sports, the NFL network, USA, the Disney channel, or Fox news.
Currently most cable service providers are paying approximately $28 per customer each month for around 12 channels. Industry experts expect this Costa jumped by 36% by 2018. By this time it is expected that ESPN will charge cable providers in the neighborhood of $10 per customer.
Since around 30% of Time Warner cable's customer base uses some form of emotional package or bundle they will not see the broadcast TV surcharge or sports programming increase immediately. However once whatever promotional offer the customer is a part of ends they'll get hit with charges the following month.
Time Warner cable has released that prices for its Internet packages will not change in the near future.