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What change in Time Warner ownership could mean for you
ALBANY -- Continuing coverage now on a cable price hike. Time Warner Cable's sale to Comcast is still pending even as rates for current customers are set to climb. So that got us thinking -- what could the merger between the two media giants mean for you?
This week we learned rates for most customers will rise by an average of six percent, because Time Warner is tacking on a broadcast TV fee to your monthly bill. However, that could be just the beginning after a change at the top of the TV dial.
Karen Hassett's parents are Time Warner Cable clickers and they aren't looking forward to paying any extra for their favorite shows.
"They're in their 80's," she said. "It would be a significant impact on them."
TWC says the merger with Comcast has nothing to do with the rate raise to come in March.
"I don't like them getting any larger or joining forces because inevitably it does mean that will be an increase beyond the six percent I'm sure as time goes on," Hassett said.
An expert on marketing says she's right!
"There is no incentive for cable companies to reduce the price when there is no competition," said Sanjay Putrevu, professor of marketing at UAlbany. "While there is some competition with Verizon and the DISH Network and so on it is not as big as cable companies competing with each other."
If the merger is approved, Putrevu says the Time Warner/Comcast connection will cover about thirty percent of national cable subscribers.
"To save money we have cancelled actually using Time Warner Cable," Meghan Kuftiak said. "We use them for internet but it saved us a lot of money."
But the cable companies might tell you that's another reason why rates could continue to climb -- whether they were bought out or not.
"The more people drop the cable companies say we have fewer people to spread the cost around," Putrevu said.
The good news Putrevu reports is that a lack of competition could actually stimulate the market for new cable providers. Pressure on the companies might make new plans available, like "a la carte" channel purchasing -- essentially buying only the channels you wanted.
"They keep talking about it like a newspaper saying you can't just get the sports section you can't just get the life section you have to get the whole newspaper for it to be worthwhile for them," Putrevu said.
But if Kuftiak had the option, "that would definitely be a great option," she said. "I was uncomfortable spending so much money months for channels we weren't using."CBS6 asked Time Warner Cable if that was at all possible -- to basically pick and choose what channels you wanted. They said it isn't, because the networks are unwilling to allow it.