With the major cable/satellite providers hurting from cord-cutting, they will have to replace their lost revenue by raising prices on internet access according to one industry analyst.
With cord cutting predicted to take out another 1 million-plus pay-TV subscribers in the third quarter, and probably set to accelerate beyond that, Jefferies analyst Mike McCormack has crunched some numbers and determined that cable operators are actually going to be OK.
With each triple-play customer who downgrades their subscription from triple-play to broadband-only, the average cable operator loses an average of $32 a month in EBITDA, McCormack said in a note to investors this morning.
The good news (for operators, but not consumers, that is)? Cable companies can probably get away with it, the analyst noted.
What can you do to keep from getting price-gouged? Not much if you live in an area where there is only one provider. If you are lucky enough to have more than one then switching providers every couple of years to get promotional pricing is an option.
Yes, it IS a hassle. But until their is true competition in the broadband market this is just about the only option there is.