On the heels of its retransmission-consent pact with Sinclair Broadcast Group, Mediacom Communications is raising prices for customers for a second time in three months, officials confirmed Thursday.
Blaming its new deal with Sinclair as part of the reason for the latest hike, the MSO is increasing rates on its expanded-basic-cable package by 4%-8% effective in May, according to Tom Larsen, the cable company’s vice president of legal affairs.
Back in January, Mediacom disclosed that it was raising rates, effective in March, for offerings such as its Internet service and premium services, including HBO and Showtime. Those price increases impacted prices for Mediacom’s digital subscribers, and they had nothing to do with expanded-basic rates.
“People who have advanced digital services will see two rate increases,” Larsen said. “The majority of our customers were not affected by the first rate increase. Obviously, this rate increase will impact anybody subscribing to our cable packages, because it’s the lowest levels of service.”
In markets such as Des Moines, Iowa, that means Mediacom’s Family Cable package, which is broadcast-basic and expanded-basic cable, will go to $51.95 per month from $47.95. The price for the company’s broadcast-basic tier, with its 20 channels, will go to $19.95 from $16.95.
Mediacom said it is raising prices for expanded basic due to increased programming costs, including the license fees it will have to pay Sinclair as the result of a retransmission-consent pact the parties reached Feb. 2, according to Larsen.
During that bitter battle, Sinclair pulled its TV stations from Mediacom’s systems for nearly one month, and the cable operator said it lost 7,000 subscribers in the fourth quarter alone due to the dispute. Ultimately, Mediacom agreed to pay Sinclair cash to carry its TV stations.
Larsen also attributed the May expanded-basic-rate increase to rising operating costs, including the skyrocketing price of gas.
“The biggest driver [for the May rate increase] is programming costs,” he said. “The retrans costs are part of that. Operational costs including employees wages, fuel, trucks -- it’s expensive. Those are the primary drivers.”
