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Direct Response Marketing

Field Reports

1 Aug, 2007 By: Thomas Haire, Courtney Beth Pugatch Response


Cable Operators to Raise Rates On Set-Top Boxes

By Courtney Beth Pugatch (cpugatch@questex.com)

WASHINGTON — Cable companies are planning to charge more for set-top boxes to help pay for new, more expensive ones mandated by the Federal Communications Commission (FCC). The cable companies blame the price increase on the government's push to urge competition for the boxes, which are required to receive digital programming — and will be required for all analog televisions when the government mandated switch to digital transmission is complete in 2009.



For the past decade, the FCC has been trying to open the set-top box market so subscribers can purchase their own boxes and use cable company-provided cards to decode their programming.

The market, however, has failed to materialize and consumers are still renting the boxes from their cable companies. Starting on July 8, cable companies are now required by the FCC to start shipping new set-top boxes with detachable cards.

Cable operators estimate the cost of renting a box will be $2 or $3 more per month, but isn't sure if the cost will be divided among all subscribers. They're also unsure if the fee increase will apply to cable cards.

Comcast Corp. said in a statement that the FCC cable card requirement "amounts to an FCC tax of hundreds of millions of dollars on consumers." There is no date mentioned when this charge will take effect, though the FCC is looking at sooner than later. The FCC has already granted extensions to the cable industry.

Retailers Excited For Back-to-School Season

WASHINGTON — After slow sales during second quarter, retailers are preparing for the back-to-school season, according to the National Retail Federation (NRF). June 2007 retail sales rose 3.4 percent compared to June 2006, but decreased 0.5 percent from May.



These figures were released by the U.S. Commerce Department on July 13, and include non-general merchandise such as automobiles, restaurants and gas stations. "It's not really a surprise," said Scott Silverman, executive director of Washington-based Shop.org, the National Retail Federation's association for online retailers. "We are between the Easter and back-to-school period where things are typically slow for retailers, not to mention the fact that we are still seeing some slow down in the economy."

Clothing and clothing-accessories stores sales decreased 1.4 percent, seasonally adjusted, month-to-month. However, these sales increased 4.9-percent, unadjusted, year-over-year. Electronics and appliances also posted mixed results, with sales decreasing 1.4 percent from May but increasing 1.4 percent from last June.

FTC Recommends Against Net Neutrality Regulation

By Courtney Beth Pugatch (cpugatch@questex.com) and Thomas Haire (thaire@questex.com)

WASHINGTON — On June 27, the chairman of the Federal Trade Commission (FTC) made a statement recommending against regulation of high-speed Internet traffic. Deborah Platt Majoras said policymakers in Washington should proceed cautiously with the issue of "net neutrality."



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