Mediacom Communications Company_Rate AdjustmentsMediaco
March 29, 2013
Mr. Kevin Firntahl
City of Dubuque
50 W. 13th Street
Dubuque, Iowa 52001 -4864
Dear Mr. Firntahl
RECEIVED
13APR -I AMI0 :50
City Clerk's Office
Dubuque, IA
The purpose of this letter is to inform you that, on or about May 1, 2013, Mediacom will
be implementing the following rate adjustments:1
Product:
Old Rate:
New Rate:
Net Change:
Local Broadcast
Station Surcharge
N/A
$1.92
$1.92
Family Cable
$72.30
$74.30
$2.00
The decision to make price adjustments is always a difficult one, especially as our
Nation continues to recover from a lengthy recession. Contrary to public perception, we
are very reluctant to raise video prices because when we do, we lose subscribers.
However, cable and satellite companies are constantly being pressured by the
programmers we buy from to pay more for the channels we carry. Mediacom is no
exception as our overall programming costs rose by over 12% in the past year. In fact,
every penny of this increase will be passed on to the programmers.
The fees we pay to retransmit local broadcast stations like ABC, CBS, FOX and NBC
are by far our fastest growing programming cost component. Outdated federal laws
give the local broadcast stations monopoly power over network and syndicated
programming within their respective market areas. Over the past few years, many
broadcasters have used their monopoly powers to demand 100 %, 200% and even
300% rate increases during contract negotiations. This has driven up cable and satellite
rates and forced American consumers to pay billions of dollars for "free" over - the -air
television.
Beginning in May, Mediacom will institute a Local Broadcast Station Surcharge equal to
fee increases the local broadcast stations in your market have demanded we pay to
them since the start of 2012. By bringing more transparency to the unjustified fee
increases being taken by local broadcast stations, we hope to draw the attention of
consumers and their elected representatives to this rapidly escalating problem. As the
saying goes, sunlight is the best disinfectant and we hope shedding more light on this
issue will force lawmakers in Washington to fix this outdated regime.
1 Depending on the terms of their contract, certain customers on promotional rates may or may not receive this rate
change at this time.
Unfortunately, local broadcasters aren't the only programmers causing cable and
satellite prices to rise. Other channel owners, especially national and regional sports
networks, are insisting on huge rate increases that are driving up the cost of Family
Cable. One look at the skyrocketing rights fees announced with recent deals and it is
easy to see that the marketplace for live televised sports is out of control. The television
rights to the Los Angeles Lakers and Los Angeles Dodgers recently sold for $3 billion
and $7 billion respectively. These are just two in a long list of examples of the
unrestrained spending that has become the hallmark of the sports programming
business.
Since the programming community has been unwilling to exercise even the slightest
measure of self- restraint when it comes to reigning in their spending or increasing their
price demands, Mediacom has taken the fight to Washington. We have asked the
Federal Communications Commission and Members of Congress to protect senior
citizens, low- income households and rural residents from practices that are rendering
pay television unaffordable for more and more Americans. We even started a petition
asking President Obama for help (see http: / /www. change .org /petitions /white- house-
protect -tv- viewers - from - broadcast - blackouts- and - unfair - price - increases). We invite the
leaders of your community to do the same.
Despite the business challenges we face, Mediacom appreciates the opportunity to
continue to serve your community's telecommunications needs. If you have any
questions, please contact me directly at (319) 395 -9699 ext 3461 or via email at
Igrassleymediacomcc.com
Yours sincerely,
Lee Grassley
Senior Manager, Government Relations
Mediacom Communications
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