Analyst Warns Cable Firms May Double Web Access Fees
Argues they may look for added Internet profits amid TV subscriber losses
NEW YORK - Cable subscribers may not only have to fear carriage disputes that lead to the temporary loss of programming, but also growing Internet bills, the New York Post reported Thursday.
Morgan Stanley analyst Benjamin Swinburne said in report that cable companies may have to double charges for broadband services if more consumers cancel their cable subscriptions to watch TV content online over time.
While Web-enabled TV sets make it easier for consumers to do away with their cable service, Swinburne said the weak economy and housing market are the key culprits for people discontinuing cable service rather than a broader trend of "cord cutting." Still, if more people move in that direction, cable companies will have to make up for the lost revenue and profit. The most likely path is to boost the cost of Internet access services, the analyst argued.
The just-started third-quarter earnings season is expected to yield more color on how prevalent "cord cutting" is becoming.