Due to increases in programming charges from cable and local TV networks, the Frankfort Plant Board (FPB) of Directors must now look at the potential to increase cable service charges.
On Tuesday, November 19, FPB will hold a public hearing, prior to the regularly scheduled Board meeting, to hear comments from the public concerning an increase in some cable service rates.
Cable networks have continued to pass along increases of at least six percent in each of the last three years to all cable and satellite providers, including FPB. Unfortunately, FPB must now again look at passing along these increases to its customers. John Higginbotham, FPB Cable-Telecom Superintendent, says this is an unfortunate, but necessary part of being in the cable business. “Every year, programmers hit FPB with increases and while FPB is non-profit, the utility can no longer take on the increased cost alone. We have a long history of offering some of the most competitive pricing for cable TV in the nation but the increased cost for programming has forced us to pass along the increase to our customers.” Higginbotham continued, “We are proposing to raise our rates with the most minimal increase possible. That will allow us to catch up on the increases, but still offer our customers the lowest rate possible.”
FPB Cable customers could see a different charge on their bill that is a direct result of the increased broadcast fees. Higginbotham explained, “We were hit on January 1 of this year with a $3.72 fee for retransmission of local network feeds. We correctly anticipated another rate increase in broadcast retransmission fees this year and our Board voted on that last year. This year’s direct pass through to customers for the retransmission fee is up from $3.72 to $4.32.”
Retransmission fees, or retrans, began five years ago and is a straight pass though from ABC, CBS, FOX and NBC affiliates in Lexington and Louisville. While those fees are a straight pass though from the networks to FPB customers, Higginbotham pointed out an added value associated with the fee. “FPB carries the four Lexington market network affiliates and three from the Louisville market. That is something none of our competitors can offer. We are the only provider that can offer Lexington and Louisville and of course, FPB-TV formerly known as Cable 10.”
The proposed increase FPB Classic Cable subscribers will see is $4.00, from $45 to $49. Higginbotham compared Time Warner Cable customers in the central Kentucky area and those who subscribe to satellite providers Dish Network and Direct TV and each have virtually the same line-up at a far more expensive cost. “FPB Classic Cable’s line-up stacks up favorably to our competitors. Their rates range from $64.99 to $75.00, at $49 we feel like we have a tremendous value. Not to mention we are local and take great pride in serving our community.”
Preferred Cable customers could see an additional one dollar increase. Higginbotham explained, “We added multiple networks to our lineup over the last two years. These additions, combined with our redesigned lineup, give FPB Cable customers access to virtually every desired network at the lowest rates around.”
Premium Channels have also added costs to FPB in the last few years and FPB did not pass along those charges from July 2010 until last year. Customers that subscribe to HBO, Cinemax, Showtime, Starz and Encore could see a small increase of $1.00 on their bill. “Everything has gone up nationwide and these premium providers are no exception”, added Higginbotham, “the value to these networks increases as FPB now offers Video-on-Demand (VOD) for each premium channel. So customers that subscribe get more bang for their buck.”
The Board will also consider minimal changes to the Bulk 1 and Bulk 2 Cable fees. These Bulk Cable customers include office buildings, hotels, hospital and other multiple hookup per building entities.
There will also be a decision on a potential new business class customer bundle offer. The Business Class Bundle would allow for discounts and locked pricing on three services: FPB Commercial Security, Commercial Phone and Commercial Broadband for a contract period of 36 months.
During the public meeting, Higginbotham will detail the plan, potential future cable and broadband rate structures and the impact it will have on customers. The Board will then vote on the proposed changes to the rates at their regularly scheduled meeting on November 19. If the rate changes are approved, customers will see the change reflected as of January 1, 2014.