10 Things Cable Companies Won't Say

For years the cable business had acted like a typical monopoly, providing less-than- ideal customer service, skyrocketing prices, and little choice of service. Then along came the Telecommunications Act of 1996, which opened the door for competition and promised weary cable customers relief at last. Too bad that relief never came. Nearly four years after the bill was passed, a mere 286 of the 30,000 U.S. cable markets were being served by more than one provider, according to the Federal Communications Commission. And in the FCC’s most recent report, in 2005, not much had changed; only 294 out of about 33,000 U.S. cable markets were served by more than one provider—meaning that for all the effort to create change, few customers today are being served by the smaller providers that generally offer better deals.

The lucky few who live in markets with more than one cable company to choose from pay about 17 percent less than those in single-provider markets, according to the FCC. “The Telecom Act was meant to generate more competition, resulting in lower prices for cable TV customers,” says David Butler, formerly of the Consumers Union, a Washington, D.C., consumer-watchdog group. “We have seen just the opposite—more mergers, less competition, and rising prices for customers.”

Meanwhile, the only real alternative to cable—satellite television—has its own issues. While subscribers have been lured with the promise of competitive prices and more programming, about 8 percent of satellite customers still subscribe to cable television, since most satellite services cannot carry local broadcasters’ signals, which cover events like city council meetings and high school football games. And satellite service delivers only one channel to a household at any given time—unless users purchase an extra settop box for each TV, which may cost up to $69 apiece.