Comcast Cable Rate Increase Coming

On March 1, 2006 Comcast Cable will be raising it's rates for service once again. The reason for this increase is due to continuing investments by Comcast to it's services such as their new Digital Voice phone service, video-on-demand and digital video recorders. And once again the media will go into a feeding frenzy with their stories of how cable rates in the Portland area have increased at a pace that is four times higher than inflation or how the poor and the homeless are being overcharged for a service that is a luxury not a staple of life.

The Oregonian is always ready to offer up a juicy piece on Comcast raising it's rates even while mentioning how the city of Portland is considering building their own fiber network which could offer TV and high-speed internet service. Whether through a partnership with private industry or on its own, the cost of such a project would run about $470 million. A price that would be more than the city could afford and perhaps a price so high that a private investor would balk.

Just consider that last paragraph. People criticize the cable operators for raising their rates and even when companies such as Comcast try to explain the reason, pointing to such items as upgrades to services and infrastructure, nobody seems to or wants to understand the high cost of doing business. The city of Portland claims to be pursuing the possibility of building a fiber network to compete with cable operators but in the end, nobody will be willing to foot the bill. $470 million is a huge amount, and like the OHSU aerial tram project you can bet that the budget on such a project would far exceed original estimates.

So before you become outraged by the coming rate increase for cable service, take the time to remember that there are huge costs involved in maintaining such a system and perhaps Comcast and other cable operators do indeed have valid reasons to increase their rates. For the most part they do an excellent job of providing service, they are willing to invest vast sums of money to ensure a quality product and with the exception of Verizon not many companies are will to put up the money to try and compete.