What causes cable TV rates to climb? Two factors play a role

While prices for Golden West internet and phone services have held steady for many years even as speed has increased, two things have driven up the cost of cable TV. Programming costs have increased, and retransmission consent fees have risen rapidly.  

Golden West apologizes for the higher cable TV costs; the cooperative is not choosing to raise rates for increased profits. Rather, to stay in business and maintain fair practices for all members, Golden West must pass along the cable TV increases it incurs. 

This fact has hit hard again this year. Residential customers will see a $4.00/month increase for cable TV programming beginning in August. This is after retransmission consent fees went up in April by about $6.00 per month in the west to almost $9.00 more in the east and central parts of the state. Let’s take a closer look at the forces behind these rising rates. 

Programming and retransmission fees

Owners of cable TV channels like AMC, Discovery, Disney, ESPN, and more charge PROGRAMMING FEES for Golden West to carry their channel. Larger companies continually buy more channels; today six or seven companies own almost all channels. This leads to more demands and less competition, which translates to higher rates. 

Golden West periodically reviews its programming costs and passes increases along to customers. This does not improve the cooperative’s margins. 

In addition to cable TV channels, Golden West passes along charges from affiliate broadcast stations (local ABC, CBS, NBC, and FOX stations). These stations charge RETRANSMISSION CONSENT FEES for passing, or transmitting, their signal to cable and satellite customers for over-the-air programming. If their demands aren’t met, each broadcaster can force the removal of their station from the lineup when agreements expire. To give you a clearer picture of retransmission consent costs, learn more here. 

Retransmission fees go directly to the affiliate broadcasters and their out-of-state corporate owners. Golden West does not keep one cent of retransmission fees. Like ownership of cable TV channels, a handful of national media conglomerates operate most affiliate broadcasters, including many stations in South Dakota. 

Aren’t the airwaves public? 

Broadcasters use public airwaves at no cost as a gift from taxpayers, so local channels are broadcast for free. However, rural residents often live too far from a transmitter to receive reliable signals with an antenna.  

These rural customers rely on cable TV to receive local news, weather, and sports. Golden West expands the reach of these stations to attract advertisers. Still, the affiliate broadcasters choose to exploit and profit from people who want or need to receive local channels via cable or satellite TV. 

Retransmission consent fees first appeared as a small, seemly insignificant charge in 2009. Through required renegotiations, the cost has risen exponentially every year since.  

Other telecommunications cooperatives in South Dakota have discontinued cable TV due in part to rising costs. Golden West appreciates your business and your understanding as we plan to continue to provide quality cable TV service – even as charges increase. 

For more information about Cable TV Retransmission Fees, visit goldenwest.com.