According to Barron’s, Comcast was able to raise rates for basic cable by 5.4%. The data to estimate the figure was based on a survey of several markets by Berstein Research.
So, the bottome line is that the competition from Verizon’s new fiber FiOS TV service is "restrained". In other words, the $18 billion that Verizon is putting into it fiber initiative is not scaring Comcast into rate breaks to keep customers.
Although the news is not definitive, it is hardly good for Verizon. The company’s massive bet on FiOS has to pay off within the next year or so, or Verizon management will look like a pack of fools to Wall St.
Some industry experts think that Verizon is simply too far behind the cable companies, and that, with their investment behind them and Verizon’s $18 billion being spent now, it is "game, set, match" to the cable guys.
Until the market see companies like Comcast and Cablevision offering sharp discounts on cable TV, Verizon is struggling.
Douglas A. McIntyre can be reached at firstname.lastname@example.org. He does not own securities in companies that he writes about.