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.
