January 8, 2003
Consumer Group: Cable Operators Inflate Profits
Cable Operators: Higher Charges Caused By Increased Operating Costs
A consumer advocate group says cable television companies are cheating customers to inflate profits.
The cable system operators claim they're charging customers more so they can offset higher operating costs.
But Mark Cooper, head of research for the
Consumer Federation of America, said they've increased cable industry profits by $8 billion.
Gene Kimmelman, the head of CFA's Washington office, said the problem is that competition has all but disappeared -- a result of deregulation.
In markets with more than one cable operator, government statistics show rates are 17 percent less.
Kimmelman said Congress should put cable TV back in the hands of state utility regulators, who can better protect consumers from price gouging.