Cable company wants rate hike

Tuesday, Dec. 17, 1996 | 11:59 a.m.

and Ed Koch

More cable. More money.

If a proposal by Prime Cable goes through, cable television subscribers will be paying $1.09 more a month for basic service.

If subscribers choose a nine-channel package of new services to be added to Southern Nevada's largest cable system, they will pay a projected $1.95 more a month for the first six months and $2.95 more a month thereafter.

"The two issues are completely unrelated," said Steve Schorr, Prime Cable's director of government relations.

"The proposed basic cable increase to $8.10 (plus a nickel for the federal government and 25 cents for local governments to bring the total to $8.40) is based on things added to the system."

They include a 30 percent increase in programming costs to Prime this past year, additional salary demands and addition of lines to 30,000 new homes last year.

The 16 "basic" stations, channels 2-17, include the four major network affiliates, two Spanish networks, the Weather Channel and Chicago and Atlanta superstations. Currently priced at $7.31, it is the cheapest of all Prime services.

However, to get the other services, all subscribers must first have basic, so the rate hike affects all 335,000 Prime subscribers.

Still, Schorr notes, under federal regulations, Prime could have raised its basic rates by as much as $12.14 a month. And, he said, the $1.09 rate hike proposal has not been finalized.

County records indicate the cable company applied Dec. 1 to raise its basic monthly rate.

Prime Cable last raised rates Feb. 1 when the monthly cost for the 56-channel standard basic cable package increased from $22.25 to $23.85.

Brenda Trainor, regional telecommunications manager for Clark County and administrator of Prime Cable's franchise for the county and the cities of Las Vegas, North Las Vegas and Boulder City, said she had not expected an increase as high as $1.09.

"What we had been discussing with the company is a 30-cent give-or-take increase on the basic service tier, so this would be substantially higher than that," Trainor said.

Pending approval, the application would allow Prime Cable to impose the increase as of March 1.

Despite indications from Prime officials that the basic rate will not go up substantially, Trainor said, "It is sure that they are increasing to $8.40 a month. What is unclear is how much they are going to charge for the expanded channel programming."

The nine channels Prime plans to add over the next three years are the Cartoon Network, Bravo, Home and Garden Television, the CNN/SI Sports Network, Animal Planet, Sundance Film Channel, Classic Sports Network, Country Music Television and the Game Show Network.

County records indicate the cable company applied Dec. 1 to raise its basic monthly rate of $7.31 to $8.40.

Also, Prime Cable has an upgrade in the works that will be to televisions what a telephone is to two coffee cans and some wire.

"I think that correlation could be made," Schorr said.

The company is spending $80 million over the next three years to replace the 4,000 miles of coaxial cable in its system with fiber optic lines.

Because optical glass fibers can carry much more information than conventional copper wire, subscribers will gain many benefits, including:

* Better picture quality and fewer reception problems.

* Up to 278 channels.

* Two-way signal delivery. Customers will be able to send information as well as receive new programming. For instance: Customers will be able to order pay-per-view movies when they want to see them through a new program entitled Impulse Pay Per View.

* High-speed Internet access. Those with personal computers will have the opportunity to connect them to the fiber optic cable line rather than their telephone modem, thus greatly increasing the speed of information reaching the computer.

"With the fiber optic upgrade, the computing process is comparable (to phone lines), but you get a greater speed of service," Schorr said.

Prime Cable is phasing the new system in -- quadrant by quadrant -- over the entire Las Vegas Valley.

Schorr said by September 1999, all Prime Cable customers will be serviced by fiber optic cable.

Over the next three years, cable crews will be working in every neighborhood methodically replacing all 4,000 miles of coaxial copper cable in the system with glass fiber, he said.

And who will pay the cost?

"Everyone is concerned that the broadcast basic subscriber will pay for the new system through higher rates, but that's not the way we see it," Schorr said. "The way we see it is: Those who utilize the increased services will help pay for the system."

In other words, cable operators plan to generate revenue through charges for increased channel packages, Impulse Pay Per View ordering, digital television hook-up, Internet access and other new services.