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Biennial Survey of Cable Industry Prices, FCC Form 333

FCC 18-181A7

OMB: 3060-0647

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Media Appendices

B. Video and Audio Market Appendices

2018 Communications Marketplace Report

Video and Audio Appendices

APPENDIX B-1
REPORT ON CABLE INDUSTRY PRICES

TABLE OF CONTENTS
Heading
I.

INTRODUCTION AND EXECUTIVE SUMMARY ........................................................................... 1
A. Summary of Findings....................................................................................................................... 3

II. OVERVIEW OF THE SURVEY ......................................................................................................... 11
A. Effective Competition Communities ............................................................................................. 13
B. Overview of Survey Methodology................................................................................................. 14
C. Programming Services ................................................................................................................... 17
D. Survey Accuracy and Reliability ................................................................................................... 23
III. SURVEY RESULTS............................................................................................................................ 24
A. Cable Programming Services ......................................................................................................... 25
B. Cable Programming Channels ....................................................................................................... 30
C. Cable Equipment ........................................................................................................................... 33
D. Broadcast Retransmission Consent ................................................................................................ 35
IV. CONCLUSIONS .................................................................................................................................. 39
ATTACHMENTS 1-16
APPENDIX: Survey Methodology
I.

INTRODUCTION AND EXECUTIVE SUMMARY

1.
Section 623(k) of the Communications Act of 1934, as amended by the Cable Television
Consumer Protection Act of 1992 (Cable Act) 1 and the Consolidated Appropriations Act of 2018, 2
requires the Federal Communications Commission (or Commission) to publish a statistical report

Section 623(k), adopted as Section 3(k) of the Cable Act, Pub. L. No. 102-385, 106 Stat. 1460, codified at 47
U.S.C. § 543(k).

The Consolidated Appropriations Act of 2018 included the Repack Airwaves Yielding Better Access for Users of
Modern Services Act of 2018 (RAY BAUM’S Act of 2018), which amended Section 13 of the Communications Act
of 1934 to require the Federal Communications Commission (Commission) to publish a single, biennial
“Communications Marketplace Report,” in lieu of several individual reports that separately assessed competition
among providers of various communications services, including voice, video, audio, and data services.
Consolidated Appropriations Act, 2018, Pub. L. No. 115-141, Div. P—RAY BAUM’S Act of 2018, §§ 401-404,
132 Stat. 348, 1087-90 (2018) (RAY BAUM’S Act of 2018). Among the previous reports now included in the
Communications Marketplace Report is information that in the past was submitted to Congress as the annual report
on cable industry prices required by section 623(k) of the Communications Act. Initially, section 623(k) was
adopted as Section 3(k) of the 1992 Cable Act, Pub. L. No. 102-385, 106 Stat. 1460, codified at 47 U.S.C. § 543(k).
The prior annual reports provided statistical data on the average rates for basic cable service, cable programming
service, and equipment, as well as a comparison of the average rates of cable systems that the Commission has
found are subject to effective competition with those of systems that the Commission has found are not subject to
effective competition. The instant report fulfills this statutory requirement, as amended by the recent RAY
BAUM’S Act.

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(Report) 3 on the average rates cable operators charge for basic cable service and other cable
programming, and cable equipment to access such programming. 4 The statute requires the Commission
to compare the rates of operators subject to effective competition to the rates of operators not subject to
effective competition under a statutorily defined standard (herein after referred to as “effective
competition”). 5 In addition, section 110 of the STELA Reauthorization Act of 2014 requires the
Commission to report on retransmission consent fees paid by cable operators to broadcast stations or
groups. 6 This Report fulfills the statutory directives and presents findings as of January 1, 2017. 7
2.
For the Report, Media Bureau staff surveyed a stratified random sample of cable
communities nationwide in order to collect data on the cable rates (prices) in effect in communities as of
January 1, 2017. 8 In the Report, we refer to the communities in which the operator is subject to effective
competition as the “effective competition group” and to communities in which the operator is not subject
to effective competition as the “noncompetitive group.” Our sample includes communities from both
groups. We collected data on monthly prices to purchase basic service, expanded basic service, the next
3

47 U.S.C. § 543(k)(1) (cross-referencing 47 U.S.C. § 543(a)(2)). Citations to prior annual reports on cable
industry prices: Implementation of Section 3 of the Cable Television Consumer Protection and Competition Act of
1992, Statistical Report on Average Rates for Basic Service, Cable Programming Service, and Equipment, 12 FCC
Rcd 3239 (1997) (1997 Report); 14 FCC Rcd 8331 (1999) (1998 Report); 15 FCC Rcd 10927 (2000) (1999 Report);
16 FCC Rcd 4346 (2001) (2000 Report); 17 FCC Rcd 6301 (2002) (2001 Report); 18 FCC Rcd 13284 (2003) (2002
Report); 20 FCC Rcd 2718 (2005) (2003-2004 Report); 21 FCC Rcd 15087 (2006) (2005 Report); 24 FCC Rcd 259
(2009) (2006-2008 Report); 25 FCC Rcd 13350 (2010) (2009 Report); 27 FCC Rcd 2427 (2012) (2011 Report); 28
FCC Rcd 9857 (2013) (2012 Report); 29 FCC Rcd 5280 (2014) (2013 Report); 29 FCC Rcd 14895 (2015) (2014
Report); 31 FCC Rcd 11498 (2016) (2015 Report); and 33 FCC Rcd 1268 (2018) (2016 Report).

47 U.S.C. § 522(5) (defining cable operator). Cable operators include operators of traditional coaxial and fiber
cable systems, municipalities, and telephone companies including Verizon FiOS. Direct broadcast satellite (DBS)
providers and AT&T U-verse systems are not registered with the Commission, and thus these systems’ prices are
not part of the Report, although DBS and AT&T U-verse are competitors for purposes of assessing effective
competition. “Service tier” (service) refers to a cable service for which a separate rate applies. 47 U.S.C. § 522(l7).
Operators must provide a separately available “basic cable service” (basic service) to which customers must
subscribe before accessing any other tier of service. 47 U.S.C. § 543(b)(7). “Other cable programming” service
means any video programming other than programming offered with the basic service or programming offered on a
per channel or per program basis. Id. § 543(l)(2). Section II, Part C defines other cable programming for the
purpose of the Report.

Commission findings of effective competition generally are made in reference to a “cable community identifier”
(CUID). The Commission assigns a unique CUID to each operator for each community the operator serves. As
discussed in Section II, Part A, the Commission recently changed its process and presumption for determining
effective competition. In 2015, the Commission adopted a rebuttable presumption that cable operators in all cable
communities are subject to effective competition. Amendment to the Commission’s Rules Concerning Effective
Competition, Implementation of Section 111 of the STELA Reauthorization Act, Report and Order, 30 FCC Rcd
6574 (2015). As a result of this change, operators in nearly all communities are now subject to effective
competition. Rates of an operator subject to effective competition are not subject to regulation by a local franchising
authority (LFA). 47 U.S.C. § 543(a)(2); 47 CFR § 76.905(a). An LFA may elect to regulate the rate of basic
service of an operator not subject to effective competition. Id.

Section 110 of the STELA Reauthorization Act of 2014 (STELAR). See Pub. L. No. 113-200, 128 Stat. 2059
(2014) enacted December 4, 2014 (H.R. 5728, 113th Cong.). Specifically, STELAR instructs the Commission to
include in its now-biennial report on cable industry prices “the aggregate average total amount paid by cable systems
in compensation under section 325 [of the Communications Act of 1934, as amended,]” and to report such
information “in a manner substantially similar to the way other comparable information is published” in the report.
47 U.S.C. § 543(k)(2), as amended.

Consistent with past practice, the current survey and report collects data as of January 1 of a year prior to the
current year. We will report on 2018 in a future report.

See the Survey Methodology Appendix for a detailed description of the sampling and stratification methodology.

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most popular service, and cable equipment, as well as other information, as described in greater detail in
the Overview Section below. 9 The Report presents the average annual changes in prices and other
variables by cable service tier.
A.

Summary of Findings

3.
Average price over all communities (regardless of effective competition standing). The
average monthly price paid by subscribers who take only basic service grew by an average of 5.2 percent,
to $25.06, over the 12 months ending January 1, 2017. The average price for expanded basic service rose
by 3.2 percent over the same one-year period to $75.21. Over the five years ending January 1, 2017, the
price of expanded basic service rose, on average, by 4.1 percent annually. Average price per channel
(price divided by the number of channels offered with expanded basic service) fell by 10.1 percent to 49
cents per channel over the 12 months ending January 1, 2017. Over the last five years, price per channel
has decreased, on average, by 0.8 percent annually. For comparison, the rate of general inflation
measured by the Consumer Price Index (all items) rose by 2.5 percent over the 12 months ending January
1, 2017, and at an average annual rate of 1.4 percent over the last five years.
4.
Average price in the communities with a finding of effective competition compared to
price in communities without a finding of effective competition. On January 1, 2017, the average price of
basic service was more than 50 percent higher in effective competition communities than in
noncompetitive communities. However, the increase in the average price of basic service was smaller in
effective competition communities than in non-effective competition communities. Specifically, over the
12 months ending January 1, 2017, the average price of basic service in effective competition
communities rose by 5.2 percent to $25.17. In noncompetitive communities, the average price of basic
service grew by 9.8 percent, to $16.61. The differences between these groups in both absolute price
levels and in the change in prices over time likely reflect a complicated mix of factors, with operators
providing different service offerings in reaction to competition and regulation.
5.
On January 1, 2017, the average price of expanded basic service in effective competition
communities was about 3 percent lower than the average price of expanded basic in the noncompetitive
communities. Over the 12 months ending January 1, 2017, the average price of expanded basic service in
effective competition communities rose by 3.2 percent to $75.19. In noncompetitive communities, the
average price of expanded basic service grew by 3.6 percent, to $77.24. In contrast to the average price
of expanded basic service, the average price per channel was higher in effective competition communities
(49 cents per channel) than in noncompetitive communities (39 cents per channel). Although operators in
noncompetitive communities charged slightly more for expanded basic service than operators in effective
competition communities, operators in the effective competition group offered fewer channels. Operators
in effective competition communities offered an average of 195 video channels while operators in
noncompetitive communities offered an average of 212 channels.
6.
Average price in effective competition subgroups compared to price in noncompetitive
communities. As in prior years, we divided operators subject to effective competition into subgroups. 10
Compared to the noncompetitive communities, the average price of basic service was higher in every
effective competition subgroup, and the difference was statistically significant in all subgroups except the
rival subgroup. 11 Compared to the average price of expanded basic service charged in noncompetitive
communities ($77.24), the average prices charged by incumbent operators and rival operators were each
about 6 percent lower ($72.87 and $72.40 respectively). These differences are statistically significant.
9

The prices collected exclude state and local taxes as well as franchise fees.

We provide an overview of the sampling groups and subgroups in Section II, Part B.

Throughout this report, we determine statistical significance using a 95% confidence level. A difference that is
statistically significant at the 95% confidence level is unlikely to be due to random sampling error. Instead, the
difference may therefore likely reflect a true difference between survey groups.

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Looking at the other effective competition subgroups, the average price charged by operators of small
systems was $71.73 (7.1 percent lower), the average price charged by operators of midsize systems was
$75.35 (2.4 percent lower), and the average price charged by operators of large systems was $76.25 (1.3
percent lower). The difference between the small systems subgroup and the noncompetitive group is
statistically significant, but the other two differences are not statistically significant.
7.
Broadcast retransmission consent compensation fees. From 2015 to 2016, 12 total
retransmission consent fees paid by cable systems to television broadcast stations increased, on average,
by 31.8 percent per year. 13 Similarly, these same fees calculated on a per-subscriber basis increased on
average by 30 percent, rising from $55.82 to $72.59 over the same period. Average monthly
retransmission consent fees per subscriber per broadcast station increased by about 25 percent annually
increasing from $0.50 to $0.63 from 2014 to 2016. Over the period 2013-2016, the compound average
annual increase in retransmission consent fees was 42.3 percent, and the compound average annual
increase in fees calculated on a per-subscriber basis was 37.8 percent.
8.
Comparison of DBS to cable programming services. Direct broadcast satellite (DBS)
providers DIRECTV and DISH offer multichannel video services similar to those offered by cable
operators. 14 Accordingly, we compared DBS services to the most popular cable offering as part of the
Report even though the statute does not explicitly require it. 15 We looked at the DBS services which
appeared most comparable to cable’s expanded basic cable service: DIRECTV’s Choice and DISH’s
America’s Top 120 Plus (AT120+). Though generally comparable, there were differences in the types of
channels carried by cable operators and DBS providers. These differences are discussed further below.16
9.
As of January 2017, the average price for cable’s expanded basic service was $75.21.
This was below the price DIRECTV charged for Choice service ($78.99) and similar in price to DISH’s
AT120+ service ($74.99). 17 Each cable and DBS service offered a core package of channels along with
local broadcast channels (locals). DISH divided its price of $74.99 into separate fees of $64.99 for the
core channel package and $10.00 for the locals. In terms of average annual change in prices, from 2016
to 2017, expanded basic cable service increased by 3.2 percent, which was lower than the increases of 5.3
12

The data for retransmission consent fees are collected somewhat differently than the rest of the data in the report.
Retransmission data are collected for complete years, whereas all the rest of the data are collected as of a certain
date (January 1). As a result, the retransmission consent fee data are for the complete years 2015 and 2016 (the
latest two years for which annual retransmission consent data were available at the time of the 2017 survey),
whereas the other data in the survey, by contrast, are snapshots as of January 1, 2016 or January 1, 2017.

13
More recent estimates show that growth in retransmission consent fees has slowed. From 2016 to 2017, SNL
Kagan estimates that total retransmission consent fees paid to television stations increased by 17.7 percent. SNL
Kagan, U.S. TV station industry total revenue projections, 2006-2023 (accessed December 7, 2017).
14

DIRECTV Group Holdings LLC (DIRECTV) and DISH NETWORK Corporation (DISH).

Attachment 16 reports our DBS survey sample methodology, data sources, and detailed statistics. We surveyed
DBS services in 40 communities, separately from our cable survey, based on publicly available information. DBS
prices vary only slightly nationwide.

In comparing cable and DBS, we further note that DBS satellite service is not local-facilities-based and DBS
providers can therefore add subscribers anywhere with minimal incremental infrastructure cost. Annual Assessment
of the Status of Competition in the Market for the Delivery of Video Programming, Fifteenth Report, 28 FCC Rcd
10496, 10546 at 112 (2014).
17

See Table 1 and Attachment 16. DBS prices do not include equipment fees. Similarly, most cable operators sold
programming and equipment separately, but about one third of operators bundled programming and equipment
together in a single price. The average cable price reported reflects prices reported by both cable operators who
bundle equipment and those who do not bundle equipment. Operators who sold programming and equipment
separately reported only the programming price, while operators who bundled programming and equipment reported
the price of the bundle. None of the prices reported include taxes, franchise fees, or other surcharges.

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percent for DIRECTV service and 7.1 percent for DISH service.18 We also calculated an average price
per channel, which is the service price divided by the number of channels. 19 The average cable price per
channel was 49 cents and was significantly higher than DIRECTV’s average of 33 cents per channel and
DISH’s average of 41 cents per channel. 20
10.
Looking at the average number of channels each DBS service offered, compared to the
195 channels offered with cable’s expanded basic service, DIRECTV’s Choice service offered more
channels (239 channels) and DISH’s AT120+ service offered fewer channels (182 channels). 21 As stated,
each service offered a core channel package and local broadcast channels. The cable operators carried on
average 37 broadcast channels, compared to the DIRECTV and DISH averages of 20 and 21 broadcast
channels, respectively. 22 The difference is primarily a result of cable operators carrying relatively more
broadcast multicast channels. Another difference is related to regional sports networks (RSNs). With
expanded basic service, cable operators offered, on average, 3.1 RSNs,23 while DBS providers offered
RSNs through a separately priced add-on package.
II.

OVERVIEW OF THE SURVEY

11.
The basis of information and analysis in the Report is the Commission’s 2017 survey of
cable industry prices (survey). The Commission directed cable operators serving a randomly selected
sample of cable communities nationwide to respond to a survey questionnaire requesting prices and other
information as of January 1, 2016 and January 1, 2017. 24 As noted, we selected communities that were
subject to effective competition, as well as communities that are not subject to effective competition. We
used the information collected to estimate average values and make comparisons across groups and
subgroups of cable communities. We calculated annual changes in average values based on the data
collected in the 2017 survey. 25 We calculated average values for each survey question by subgroup, by
larger sample group, and for the full sample of communities. For each community selected for the
sample, we asked the cable operator to complete a questionnaire that included questions on the prices of
basic cable service and other cable programming service offerings.
18

Id.

Cable price per channel is not calculable directly from the price and channels averages discussed herein because
of statistical weighting of observations. We discuss cable price per channel in Sections II(C) and III(B) and in the
Methodology Appendix.
20

See Table 3 and Attachment 16. Our method of calculating the cable price per channel adds an equipment fee to
the price component. In contrast, DBS price per channel does not include an equipment fee. Calculating cable price
per channel without adding the equipment fee results in an average cable price per channel of 45 cents, still higher
than the DBS average price per channel.

See Table 5 and Attachment 16. We counted each separate channel viewable in digital format in either standard
definition (SD), high definition (HD), and in the case of several DIRECTV channels, in 4K format. A network
carried in both SD and HD formats counted as two channels.

See Table 6 and Attachment 16. A network carried in both SD and HD format was counted as two channels.

See Table 7.

Implementation of Section 3 of the Cable Television Consumer Protection and Competition Act of 1992, Statistical
Report on Average Prices for Basic Service, Cable Programming Services, and Equipment, MM Docket No. 92266, Order, 32 FCC Rcd 2984 (2017).
25

Each annual change calculated is not a comparison of data from the 2016 survey and data from the 2017 survey
because each survey includes a different sample of communities. To calculate the annual changes, the 2017 survey
collected data from the sample of communities for January 1, 2016 and January 1, 2017 so as not to introduce
random sampling variation that may occur between independent samples. While tables in the Report generally
report the 2017 statistics and annual changes based on data collected in the 2017 survey, Table 4 reports a historical
price series based on data from previous survey years.

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12.
In Part A of this section, we discuss effective competition communities and how the
process for establishing effective competition has changed. In Part B, we provide an overview of the
survey methodology, which is described in more detail in the Methodology Appendix. In Part C, we
provide definitions of specific cable services. In Part D, we review survey accuracy and reliability.
A.

Effective Competition Communities

13.
The Commission recently changed its effective competition process by adopting a
rebuttable presumption that all cable operators qualify for the type of effective competition known as
competing provider effective competition, which is verified through the “50/15” test. 26 In the 2015
proceeding, the Commission concluded that the ubiquitous nature of DBS services made it appropriate to
presume that competing provider effective competition is present in all communities, unless a showing is
made to the contrary to rebut this presumption. In a community where competing provider effective
competition does not exist, the local franchising authority (LFA) must certify the lack of effective
competition by showing that the 50/15 test is not met. The certification is valid unless and until the
Media Bureau issues a decision denying the certification request. LFAs with a valid certification may
regulate basic cable rates. Few LFAs have filed certifications to date. As a result, operators are now
found subject to effective competition, and basic cable rates are unregulated in nearly all communities in
the country. Thus far, only in Massachusetts and Hawaii have LFAs successfully certified the lack of
effective competition. The 118 certified communities in these states fail to meet the 50/15 test because
less than the required percentage of households subscribe to DBS service in these communities.
B.

Overview of Survey Methodology

14.
We selected the sample of effective competition communities from five subgroups. 27
The first two subgroups are composed of the communities in which the Commission has made a finding
of effective competition because a second wireline MVPD served the same area as the incumbent cable
provider. 28 The first subgroup is made up of the incumbent cable system operators in areas with a second
wireline MVPD overbuilding the incumbent. The incumbent is the operator who provided service prior to
the rival MVPD’s arrival in the market. The second subgroup is made up of the rival MVPDs in these
communities. The basis of findings of effective competition for the incumbent subgroup is either (a) the
50/15 test, resulting from the presence of at least two MVPDs, or (b) the local exchange carrier (LEC) test
resulting from the presence of at least two MVPDs, one of which is a LEC or an entity affiliated with or
using the LEC’s facilities. 29

26
Amendment to the Commission’s Rules Concerning Effective Competition, Implementation of Section 111 of the
STELA Reauthorization Act, Report and Order, 30 FCC Rcd 6574 (2015). The 50/15 test requires that at least two
unaffiliated MVPDs offer comparable programming each of which offers its service to at least 50 percent of
households in the market, and the percent of households taking service from MVPDs other than the largest MVPD
exceeds 15 percent. Effective competition can also be found based on one of the following three tests: (1) fewer
than 30 percent of households subscribe to the operator’s programming service (low penetration test); (2) a
franchising authority operates as an MVPD in that franchise area and offers programming to at least 50 percent of
households (municipal test); or (3) a local exchange carrier (LEC) or its affiliate (or an MVPD using the facilities of
an LEC or affiliate) offers service by means other than DBS in the franchise area of an unaffiliated operator that is
offering comparable programming (LEC test). 47 U.S.C. § 543(l)(1).
27

These subgroups are designed to achieve desirable levels of statistical precision, and, thus, are not necessarily
selected proportionately from the universe of communities belonging to each subgroup. See Attachment 1 and the
Survey Methodology Appendix for a more complete description of our sampling methodology.

The Commission made these findings of effective competition before it changed the presumption of effective
competition.
29

The incumbent subgroup uses publicly sourced data to account for communities also served by AT&T U-verse.
As noted above, (supra note 4), the Commission considers AT&T U-verse to be a competing MVPD for the purpose
of assessing effective competition. However, AT&T U-verse systems do not have cable community identifiers,
(continued….)

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15.
The remaining effective competition communities were selected from three subgroups
based on system size. We define small systems as cable systems serving 10,000 or fewer subscribers,
midsize systems as cable systems serving between 10,000 and 75,000 subscribers, and large systems as
cable systems serving more than 75,000 subscribers. 30
16.
We did not divide the noncompetitive group into subgroups. The noncompetitive group is
a sample of 33 communities drawn from the population of 118 noncompetitive communities.
C.

Programming Services

17.
We next define the programming services referenced in the Report. Service prices in the
Report reflect the non-promotional rates and exclude taxes and fees. Prices also exclude fees subscribers
may incur in leasing cable equipment unless the customer received equipment along with programming
without incurring a separate lease charge. We collected information on the basic service and other cable
programming services not offered on a per channel or per program basis, as well as cable equipment. The
other programming services on which the survey collected information are expanded basic service and the
next most popular service.
18.
Basic service. The Cable Act requires operators to offer a separately available basic
cable service to which customers must subscribe before purchasing any other service.31 A basic service
tier includes local broadcast stations entitled to carriage under the Cable Act; public, educational, and
governmental access channels that a local franchising authority requires; and other channels the operator
chooses to add. 32
19.
Expanded basic service. Expanded basic service includes basic service channels in
addition to the next most highly subscribed tier of channels, generally the tier that includes the most
popular national cable networks.
20.
Next most popular service. The next most popular service is the most highly subscribed
service after expanded basic service. It generally consists of the channels offered with expanded basic
service plus at least seven additional video channels. These additional channels could offer any type of
content, for example, general entertainment, sports, or Spanish-language programming. 33
21.
Equipment lease charge. Subscribers may incur a separate monthly charge to lease cable
equipment such as a cable signal converter box and remote-control unit, cable card, or other equipment
necessary to access programming. We collect data on such charges to the extent that respondents charge
a separate monthly fee to lease such equipment. Specifically, we asked the survey respondents to report
(Continued from previous page)
which are assigned to each registered cable operator for each individual community an operator serves, and are
therefore not part of the database from which the survey samples are drawn. The rival subgroup includes telephone
companies that do have CUIDs, and these range from large national systems like Verizon FiOS, to small municipal
telecommunication systems.
30

The first two subgroups (those of an incumbent or a rival in a community where at least two wireline competitors
serve one community) also fall into one of the size strata groups (small, medium, or large), but the first two
subgroups are selected separately from the size subgroups. This is to assure we draw a statistically significant
sample for all five subgroups.
31

Supra note 4.

47 U.S.C. § 543(b)(7), 534-35.

As of January 1, 2017, on average, 87.8 percent of subscribers took at least expanded basic service, and 12.2
percent took only basic service. This 87.8 percent includes subscribers whose operators do not offer a separate
expanded basic service tier but instead offer a basic service tier that includes many of the popular national networks
typically associated with expanded basic service. In addition, on average, 56.4 percent of subscribers took the next
most popular programming service as an additional tier. (We did not collect information on additional tiers beyond
the next most popular.)

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the price of the most commonly leased equipment at each service level (basic service, expanded basic
service, and the next most popular service) unless the equipment was included at no extra charge or was
not necessary to view all of the channels offered with the service.
22.
Price per channel. Price per channel equals the price of the service divided by the
number of channels the service offers. If equipment is necessary to view all channels in the service’s
channel lineup and is not included in the service price, the charge to lease equipment is added to the price
component of price per channel. Price per channel is a proxy for quality adjusted price and declines as
the number of channels increases, all else equal.
D.

Survey Accuracy and Reliability

23.
The data and analysis presented in this Report are consistent with the Commission’s
information quality guidelines. 34 Consistent with prior reports, we took steps to ensure the accuracy and
reliability of the survey data. We provided the questionnaires to respondents to complete and submit on
the Commission’s website. Many survey questions have built-in checks for reasonableness, which
prompted the respondents to recheck seemingly unreasonable or inconsistent responses. After receiving
the submitted surveys, we examined responses using a computer program designed to identify apparent
inaccuracies. If a response lay outside of its statistically expected range or was inconsistent with the
answers to other questions, the program flagged that response for further review. We then asked the cable
operator to review the response and make any necessary corrections. The Survey Methodology Appendix
contains more detail on our data validation process.
III.

SURVEY RESULTS

24.
Tables in this section report results from our survey of cable operators in communities
nationwide, as well as other publicly sourced data. Results are presented for the full sample and are
further broken down into noncompetitive and effective competition sample groups, as well as effective
competition subgroups. For our survey, we sampled 750 communities from the universe of 33,883
communities. In the universe of registered cable communities nationwide there are 118 noncompetitive
communities and 33,765 competitive communities, and nearly all subscribers (98.7%) receive service in a
competitive community. From the noncompetitive group, we sample 33 of the 118 communities to create
a statistically significant sample. Looking within the effective competition group, the Incumbent
subgroup accounted for 745 communities and 10 percent of subscribers nationwide. The Rival subgroup
contained 557 communities and 3.3 percent of subscribers. Most effective competition communities were
in one of the three subgroups stratified by system size. 35 The Large Systems subgroup had 8,837
communities and served 49.3 percent of subscribers. The Midsize Systems subgroup had 10,252
communities and served 28.8 percent of subscribers. Finally, the Small Systems subgroup had 13,374
communities and served 7.3 percent of subscribers.
A.

Cable Programming Services

25.
Table 1 reports the average prices of basic service, expanded basic service, and the next
most popular service on January 1, 2017. In the full sample, average prices for basic service, expanded
basic service, and the next most popular service were $25.06, $75.21, and $89.28, respectively. Table 1
also reports the percent change in price from January 1, 2016 to January 1, 2017. In the full sample, the
average price for each service increased by a statistically significant amount from January 1, 2016 to
January 1, 2017. The average price for basic service increased by 5.2% ($1.24), while the average price
34

Implementation of Guidelines for Ensuring and Maximizing the Quality, Objectivity, Utility and Integrity of
Information Pursuant to Section 515 of Public Law No. 105-554, Information Quality Guidelines, 17 FCC Rcd
19890 (2002).
35

See supra fn. 30 and the Appendix for details.

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for expanded basic service increased by 3.2% ($2.33), and the average price for the next most popular
service increased by 2.8% ($2.43).
Table 1
Monthly Price of Programming
by Status of Effective Competition
January 1, 2017
Effective Competition Subgroups
Cable
Service

Full
Sample

Noncompetitive
Group

Effective
Competition
Group

Overbuilt
Communities
Incum
bent

Rival

Small
Systems

Midsize
Systems

Large
Systems

Basic

$25.06

$16.61

$25.17

$23.02

$17.98

$30.41

$26.91

$24.31

Annual change

5.2%*

9.8%*

5.2%*

9.7%*

3.1%

2.6%

5.5%*

4.9%

Expanded
basic

$75.21

$77.24

$75.19

$72.87

$72.40

$71.73

$75.35

$76.25

Annual change

3.2%*

3.6%*

3.2%*

2.4%

1.5%

3.7%*

3.4%*

3.2%*

Next most
popular

$89.28

$93.28

$89.23

$85.34

$85.94

$84.68

$90.14

$90.32

Annual change

2.8%*

3.0%*

2.8%*

2.4%

1.9%

3.1%*

3.0%*

2.8%*

Source: Attachment 2. * Indicates annual change is statistically significant at the 95% confidence level.

26.
Table 2 reports the average price per channel by service tier on January 1, 2017. As
stated, price per channel is calculated as the sum of the programming and equipment prices (if equipment
is necessary to view all channels) divided by the number of channels offered. Average price per channel
in the full sample is highest for the basic service tier (58 cents), lower for the expanded basic tier (49
cents), and is lowest for the next most popular service tier (37 cents). In the full sample, average price per
channel decreased by a statistically significant amount from January 1, 2016 to January 1, 2017 for all
three service tiers. This decrease ranged from 6.4 percent for the next most popular service to 10.1
percent for basic and expanded basic services. The decrease in price per channel comes from an increase
in the number of channels offered on all service tiers (see Table 5) and contrasts to the increase in
programming price shown in Table 1.

2018 Communications Marketplace Report

Video and Audio Appendices

Table 2
Price per Channel
by Status of Effective Competition
January 1, 2017
Effective Competition Subgroups
Cable
Service

Basic
Annual change
Expanded
basic
Annual change
Next most
popular
Annual change

Full
Sample

Noncompetitive
Group

Effective
Competition
Group

Overbuilt
Communities
Incum
bent

Rival

Small
Systems

Midsize
Systems

Large
Systems

$0.58

$0.30

$0.59

$0.45

$0.58

$1.33

$0.63

$0.48

-10.1%*

-3.7%

-10.2%*

-2.1%

1.4%

-2.5%

-10.4%

-14.3%*

$0.49

$0.39

$0.49

$0.54

$0.39

$0.83

$0.49

$0.44

-10.1%*

-5.4%

-10.2%*

-8.4%*

3.3%

-0.2%

-8.7%

-14.3%*

$0.37

$0.34

$0.38

$0.30

$0.64

$0.39

$0.34

-6.4%*

1.7%

-6.5%*

-3.0%

1.3%

-0.6%

-4.9%

-9.8%*

Source: Attachment 6. * Indicates annual change is statistically significant at the 95% confidence level.

27.
Table 3 uses the results presented in Tables 1 and 2 to report the percent difference in
average price between the effective competition group and subgroups and the noncompetitive group for
each of the three service tiers. The average price of basic service in the effective competition group is
51.5 percent higher than the average price of basic service in the noncompetitive group. All the effective
competition subgroups have a higher average basic service price than the noncompetitive group, and the
difference is statistically significant in all subgroups except the rival subgroup. By contrast, the average
price of expanded basic service is 2.7 percent lower and the average price of the next most popular
service is 4.3 percent lower in the effective competition group than in the noncompetitive group. These
tiers are not subject to rate regulation by local franchising authorities. Table 3 also reports the percent
difference between the effective competition subgroups and the noncompetitive group in expanded basic
price per channel. The average price per channel for expanded basic service is 26 percent higher in the
effective competition group than in the noncompetitive group. These differences likely reflect a
complicated mix of factors, including inherent differences in the types of systems included in both and
different service offerings in reaction to competition and regulation.

2018 Communications Marketplace Report

Video and Audio Appendices

Table 3
Percent Difference in Average Price
Effective Competition Group and Subgroups compared to Noncompetitive Group
January 1, 2017
Effective Competition Subgroups
Cable
Service

Effective
Competition Group

Overbuilt Communities
Incumbent

Rival

Small
Systems

Midsize
Systems

Large
Systems

Basic

51.5%*

38.6%*

8.2%

83.1%*

62.0%*

46.3%*

Expanded basic

-2.7%*

-5.6%*

-6.3%*

-7.1%*

-2.4%

-1.3%

Next most popular

-4.3%*

-8.5%*

-7.9%*

-9.2%*

-3.4%*

-3.2%*

Expanded Basic
Price per Channel

26.0%*

38.3%*

1.0%

114.7%*

26.0%*

12.4%*

Source: Attachments 3 and 7. * Indicates annual change is statistically significant at the 95% confidence level. See
Attachments 3 and 7 also for comparisons between all subgroups.

28.
Table 4 reports a historical series of basic service prices for all the communities
surveyed; expanded basic service prices, channels, and price per channel; and the next most popular
service prices. Table 4 also reports the compound average annual change in prices and channels over the
latest five and ten years. 36 Using this measure, we compare the average annual increase in prices and
channels over the five and ten-year periods to the annual increase from January 1, 2016 to January 1,
2017 reported in this survey. The price of basic service grew annually by 4.0 percent over the five-year
period and by 5.0 percent over the ten-year period; these growth rates are somewhat smaller than the
increase of 5.2 percent (see Table 1) observed over the 12-month period ending January 1, 2017. The
price of expanded basic cable service grew annually by 4.1 percent over the five-year period and by 4.8
percent over the ten-year period; these growth rates are larger than the increase of 3.2 percent (see Table
1) observed over the 12-month period ending January 1, 2017. The average number of channels offered
by cable operators with expanded basic service grew annually by 5.4 percent over the five year period and
by 7.5 percent over the ten year period; these growth rates are substantially smaller than the one-year
increase of 12.5 percent (see Table 5) observed over the 12-month period ending January 1, 2017. 37 38
Average price per channel for expanded basic service declined by 0.8 percent annually over the five-year
36

The compound average annual change smooths and summarizes the annual changes observed over the period. It
is the constant annual rate at which price would have changed over the period to result in the observed growth.
37
Year 2010 was the start of a new data series for channels and price per channel, reflecting a change to the survey
questionnaire. The channel and price per channel indices in Attachment 8 adjust for this change and are the basis of
the compound average annual change, as discussed in the Appendix.
38
The large one-year increase in number of channels offered may reflect changes after mergers and acquisitions that
took place during this period.

2018 Communications Marketplace Report

Video and Audio Appendices

period and by 1.6 percent annually over the ten-year period. This compares to a 10.1 percent decrease
(see Table 2) observed over the 12-month period ending January 1, 2017. 39 The price of the next most
popular service (and lease of equipment if not included in the programming price) increased by 3.8
percent over the five-year period and by 4.7 percent over the ten-year period. This compares to an
increase of 5.0 percent (see Attachment 4) observed over the 12-month period ending January 1, 2017.
Table 4
Historical Price Series
2006–2017

Year
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017

Expanded Basic Service

Basic
Service
Price

Price

Channels

$14.59
$15.33
$16.11
$17.65
$17.93
$19.33
$20.55
$22.63
$22.78
$23.79
$25.40
$25.06

$45.26
$47.27
$49.65
$52.37
$54.44
$57.46
$61.63
$64.41
$66.61
$69.03
$71.37
$75.21

71.0
72.6
72.8
78.2
117
124.2
149.9
159.6
167.3
181.3
181.0
195.1

CPI

Price per
Channel

Next Most
Popular
Service and
Equipment

All
Items

$0.650
$0.670
$0.680
$0.710
$0.560
$0.569
$0.505
$0.484
$0.496
$0.456
$0.469
$0.487

$59.09
$60.27
$63.66
$67.92
$71.39
$75.37
$78.91
$81.64
$84.65
$86.83
$90.42
$95.13

132.2
135.0
140.8
140.8
144.5
146.9
151.2
153.6
156.0
155.8
158.0
161.9

Cable
(CSR
Index)
174.4
179.0
183.9
186.5
191.9
192.0
199.8
206.5
212.0
216.4
220.1
231.7

Compound Average Annual Rate of Change
5-year average

4.0%

4.1%

5.4%

-0.8%

3.8%

1.4%

3.0%

10-year average

5.0%

4.8%

7.5%

-1.6%

4.7%

1.8%

2.6%

Source: Attachment 8. Attachment 8 shows the series back to 1995. Rates of change for channels and price per
channel are based on the indices shown in Attachment 7 and cannot be calculated from this table.

29.
Table 4 also reports the Consumer Price Index (CPI) for all items, published by the
Bureau of Labor Statistics (BLS), which serves as a measure of general price inflation and a basis for
comparison. 40 The CPI (all items) grew at an average annual rate of 1.4 percent over the last five years
and by 1.8 percent annually over the last ten years. Over the 12 months ending January 1, 2017, the CPI
grew by 2.5 percent. Table 4 also reports a BLS price index for Cable and Satellite Television and Radio
Services (CSR Index). 41 The CSR Index grew annually by 3.0 percent and 2.6 percent over the last five
and ten years respectively, and by 5.3 percent for the 12-month period ending January 1, 2017. Because
this index covers a different mix of services and is adjusted for changes in the number of programming

The large decrease in price per channel results from a large increase in the number of channels offered.

BLS, Department of Labor (BLS), Consumer Price Index, All Urban Consumers, U.S. City Average, Not
Seasonally Adjusted, All Items (1982-84=100). Series ID: CUUR0000SA0. (Accessed February 21, 2018).
41
BLS, Cable and Satellite Television and Radio Service (Dec. 1983=100), Series ID: CUUR0000SERA02
(accessed February 21, 2018). This index is a sub-component of the overall CPI.

2018 Communications Marketplace Report

Video and Audio Appendices

channels, the CSR Index is not directly comparable to changes in cable programming prices in the
Report. 42
B.

Cable Programming Channels

30.
Table 5 shows the average number of video channels offered as of January 1, 2017, and
the annual percent change in the number of channels. The number of channels offered under each service
tier includes the channels offered under each lower tier. Also, the channel figures given here include
video channels in all formats but exclude audio-only channels. In the full sample, an average of 67
channels were offered with the basic service tier, while the expanded basic and next most popular tiers
offered 195 and 282 channels on average. A total of 512 video channels were offered by cable operators
on average. This total includes pay and pay-per-view channels and other programming tiers not included
in the Report.

Table 5
Number of Video Channels
by Status of Effective Competition
January 1, 2017
Effective Competition Subgroups
Cable
Service

Basic
Annual change
Expanded
basic

Full
Sample

Noncompetitive
Group

Effective
Competition
Group

67.2

65.2

67.3

83.6

12.8%*

2.2%

13.0%*

195.1

211.8

Overbuilt
Communities
Incum
Rival
bent

Small
Systems

Midsize
Systems

Large
Systems

57.4

36.6

60.2

73.2

-3.6%

0.6%

3.9%

10.6%*

20.4%*

194.9

169.1

241.9

122.5

192.5

208.8

12.5%*

10.0%*

12.5%*

-1.0%

5.1%

7.7%

11.9%*

16.5%*

Next most
popular

281.7

285.7

281.7

263.6

336.0

173.5

272.3

302.0

Annual change

9.4%*

0.3%

9.5%*

2.2%

0.9%

5.9%

7.5%*

12.9%*

All channels

512.4
0.8%

500.7
0.7%

512.6
1.1%

552.3
-1.7%

577.2
0.4%

329.2
10.5%*

486.4
7.5%*

541.9
10.0%*

Annual change

Source: Attachment 9. * Indicates annual change is statistically significant at 95% confidence level. See Attachment
10 for comparisons of channel counts between subgroups.

31.
Table 6 categorizes the channels available with basic service. The table reports the
average number of channels in each category available with basic service. The categories are local
broadcast; public, educational, and governmental (PEG) access; local commercial leased access; non42

BLS bases the CSR Index on a survey of items on consumers’ monthly cable bills, including premium services
and installation costs, which are not included in our monthly average. When an item shows a significant change in
price, BLS makes a quality adjustment and may change the observed price depending on the change in the quality of
the product or service in question. In the case of cable service, BLS generally perceives additional channels as an
improvement in quality and adjusts the observed price downward. BLS, How BLS Measures Price Change in the
Consumer Price Index for Cable and Satellite Television and Radio. https://www.bls.gov/cpi/factsheets/cable-andsatellite-television-and-radio.htm. (Last modified February 23, 2018).

2018 Communications Marketplace Report

Video and Audio Appendices

premium regional sports networks; and other non-premium channels. Over half of the channels offered
with basic service are broadcast channels. It is important to note that a broadcast channel is an individual
channel – standard definition, high definition, or multicast – and not a broadcast television station. For
example, if the primary signal of a broadcast television station is carried by a cable system in both
standard and high definition on separate channels, this would count as two channels. In addition, any
multicast subchannels carried count as additional channels.
Table 6
Basic Service Channel Composition
January 1, 2017
Effective Competition Subgroups
Video
Channel
Category

Full
Sample

Noncompetitive
Group

Effective
Competition
Group

Broadcast

37.2

40.5

37.2

40.9

PEG
Leased access
Regional sports
Other channels
Total

4.7
1.3
0.2
23.9
67.2

3.2
1.0
0.0
20.5
65.2

4.7
1.3
0.2
23.9
67.3

4.4
1.6
1.5
35.3
83.6

Overbuilt
Communities
Incum
Rival
bent

Small
Systems

Midsize
Systems

Large
Systems

47.3

17.8

32.6

41.3

5.0
0.5
0.0
4.5
57.4

2.1
0.5
0.1
16.5
36.6

3.6
1.1
0.1
22.9
60.2

5.7
1.5
0.1
24.6
73.2

Source: 2017 survey. See Attachment 11 for comparisons of channel composition between subgroups.

32.
Table 7 reports the average number of regional sports networks (RSNs) included with
each service tier. The survey defines RSNs as networks that carry a substantial number of live games
from at least one nearby professional sports team that is a member of the National Football League, Major
League Baseball, National Basketball Association, or National Hockey League. No pay-per-view channel
is considered an RSN. The average number of RSNs offered with basic service, expanded basic service,
and the next most popular service are 0.2 channels, 3.3 channels, and 3.6 channels, respectively.
Table 7
Regional Sports Networks
By Status of Effective Competition
January 1, 2017
Effective Competition Subgroups

Cable
Service

Full
Sample

Noncompetitive
Group

Effective
Competition
Group

Overbuilt
Communities
Incum
bent

Rival

Small
Systems

Midsize
Systems

Large
Systems

Basic

0.2

0.0

0.2

1.5

0.0

0.1

Expanded basic

3.3

4.5

3.3

7.1

2.2

3.5

3.1

Next most popular

3.6

4.5

3.6

3.3

8.0

2.4

3.6

Source: 2017 survey. See Attachment 12 for comparisons of RSN carriage between subgroups.

2018 Communications Marketplace Report

Video and Audio Appendices

Cable Equipment

33.
Table 8 reports the average equipment lease fee for each service tier. 43 Specifically, this
is the monthly fee to lease the equipment most commonly leased by subscribers of each service tier. This
equipment may be a converter box or other equipment necessary to view all channels offered with the
service tier. The equipment lease fees reported represent the fee to lease a single piece of equipment, not
the total amount paid for all equipment leased by a household. In the full sample, the average equipment
lease fee was about $9 for all service tiers, and this fee had not increased significantly over the previous
year.
Table 8
Average Equipment Lease Fee
Most Commonly Leased Equipment
January 1, 2017
Effective Competition Subgroups
Cable
Service

Full
Sample

NonCompetitive
Group

Effective
Competition
Group

Overbuilt
Communities
Incum
bent

Rival

Small
Systems

Midsize
Systems

Large
Systems

Basic

$9.17

$7.11

$9.18

$9.63

$10.33

$8.78

$8.51

$9.36

Annual change

1.6%

1.3%

1.6%

5.7%*

-0.1%

1.5%

0.8%

0.9%

Expanded basic

$9.29

$7.10

$9.31

$9.63

$10.95

$8.83

$8.69

$9.46

Annual change

1.6%

1.3%

1.6%

5.9%*

-0.1%

1.5%

0.8%

0.9%

Next most popular

$9.38

$7.11

$9.39

$9.67

$10.92

$9.21

$8.88

$9.45

Annual change

1.8%

1.3%

1.8%

5.7%*

0.0%

2.6%

1.4%

0.9%

Source: Attachment 13. * Indicates annual change is statistically significant at the 95% confidence level. See
Attachment 14 for comparisons between subgroups.

34.
Table 9 shows the percentage of subscribers who have access to the following particular
features with the most commonly leased equipment by service level: digital video recorder (DVR); high
definition (HD); interactive programming guide (IPG); and remote-control unit (RCU). 44 In the full
sample and for all service levels, DVR and HD capabilities were not widely available with the most
commonly leased equipment. In contrast, an IPG and an RCU were almost universally available to
subscribers with the most commonly leased equipment.

Some operators do not charge an additional fee for equipment. Instead these operators bundle cable service and
equipment. The average equipment lease fees reported in Table 8 are the average fees for operators who did not
bundle cable service and equipment and priced cable service and equipment separately. In our sample, in most
communities (65 percent), the operator did not bundle cable service and equipment.
44

This is not the percentage of subscribers who receive a particular feature. Instead, we ask operators whether each
feature is available with the most commonly leased equipment for each service level. The percentages above are the
percentages of subscribers in communities where the feature is available with the most commonly leased equipment
at a particular service level. Because one subscriber may lease multiple pieces of equipment for multiple television
sets, the percentages reported in Table 9 are likely to be different from the percentages of subscribers who receive a
particular feature.

2018 Communications Marketplace Report

Video and Audio Appendices

Table 9
Equipment Features Offered
Most Commonly Leased Equipment
January 1, 2017
Effective Competition Subgroups
Cable
Service

Feature

DVR
HD
Basic
IPG
RCU
DVR
Expanded HD
basic
IPG
RCU
DVR
Next most HD
popular
IPG
RCU
Source: 2017 survey.

Full
Sample

12%
27%
94%
96%
12%
27%
95%
96%
13%
28%
95%
95%

Noncompetitive
Group

0%
0%
100%
100%
0%
0%
100%
100%
0%
0%
100%
100%

Effective
Competition
Group

12%
28%
94%
96%
12%
28%
95%
95%
13%
28%
95%
95%

Overbuilt
Communities
Incum
bent

Rival

46%
49%
91%
92%
46%
49%
91%
92%
46%
49%
92%
92%

4%
83%
85%
100%
4%
85%
97%
98%
4%
85%
97%
98%

Small
Systems

Midsize
Systems

Large
Systems

30%
59%
84%
88%
30%
61%
86%
88%
32%
60%
86%
83%

8%
17%
94%
95%
8%
17%
94%
95%
9%
18%
95%
96%

7%
22%
97%
99%
6%
22%
98%
97%
6%
22%
97%
97%

Broadcast Retransmission Consent

35.
Section 110 of the STELA Reauthorization Act of 2014 (STELAR) requires the
Commission to report on retransmission consent fees paid by cable operators to broadcast stations. 45
Therefore, the survey asked operators to report total retransmission consent fees paid to broadcasters and
the number of subscribers covered by retransmission consent payments in 2015 and 2016. The
instructions requested that respondents exclude other fees such as copyright fees. In addition, operators
reported the number of broadcast stations carried pursuant to retransmission consent agreements.
36.
Table 10 presents information on retransmission consent compensation. Average annual
retransmission consent fees calculated on a per subscriber basis increased by 30 percent, rising from
$55.82 to $72.59, from 2015 to 2016. 46 The number of broadcast stations carried per cable system
pursuant to retransmission consent agreements did not change between 2015 and 2016: about eleven
broadcast stations were carried per cable system pursuant to retransmission consent each year. Average
monthly retransmission consent fees paid by cable systems to broadcast stations on a per subscriber per
station basis increased from $0.50 to $0.63 from 2015 to 2016. In the sample, a total of $2.4 billion in
retransmission consent fees was reported for 2015. In 2016, the total reported was $3.3 billion.
Operators in the sample reported fees covering about 46.1 million subscribers in 2015 and 47.6 million
subscribers in 2016.

See fn. 6, supra.

To calculate annual retransmission consent fees on a per subscriber basis, we divided total retransmission consent
fees reported per cable system by the number of subscribers subject to retransmission consent—those who received
stations carried pursuant to retransmission consent—per cable system.

2018 Communications Marketplace Report

Video and Audio Appendices

Table 10
Retransmission Consent Fees and Subscribers
2015

2016

Percent
Change

$30,941,686

$40,771,516

31.8%*

Average Number of Subscribers Pursuant to
Retransmission Consent per Cable
System 47

614,359

601,530

-2.1%

Average Annual Retransmission
Consent Fees Paid per Subscriber

$55.82

$72.59

30.0%*

Average Number of Stations Carried Pursuant to
Retransmission Consent per
Cable System

11.09

11.37

2.5%

Average Monthly Retransmission Consent Fees
Paid per Subscriber per
Station

$0.50

$0.63

25.9%*

$2,382,129,408

$3,252,965,120

36.6%

46,071,184

47,576,100

3.3%

Average Annual Retransmission
Consent Fees Paid per Cable System

Total Retransmission Consent Fees
Reported in Sample
Total Subscribers under Retransmission Consent
Reported in Sample

Source: 2017 survey. * Indicates annual change is statistically significant at the 95% confidence level. Note: No
test of statistical significance can be applied to total retransmission consent fees or total subscribers under
retransmission consent. In the sample, total retransmission consent fees and total subscribers are known quantities.

37.
To track changes in retransmission consent fees over time, Table 11 provides an index
that reflects the annual changes reported in the three surveys that have collected retransmission consent
data. 48 The base year of the index is 2013, and the index’s value for 2014 reflects the increase in
retransmission consent fees from 2013 to 2014 as reported in the 2015 survey, the first survey that
collected data on retransmission consent fees. 49 The index shows that the growth of retransmission
consent fees has slowed. Over the 2013-2014 period, retransmission consent fees per subscriber
increased by 50 percent, while the 2014-2015 period showed an increase of 34.1 percent, and the 20152016 period showed an increase of 30.0 percent. Over the 2013-2016 period, the compound average
47
In this table, cable system is not strictly defined. Retransmission consent fees and subscriber counts per cable
system were reported at various system levels ranging from an individual cable community to a broad geographic
region encompassing multiple markets. Respondents may vary this level of aggregation from year to year, and thus
the “Fees Paid per Cable System” cannot be directly compared across surveys. However, the index reported on the
next page adjusts for these issues and thus is comparable over time.
48

Retransmission consent fee estimates are not directly comparable across surveys because of sampling variance
and differences in reporting levels used by operators.
49
The index’s value for each of the following years is calculated analogously. The index’s value for 2016 reflects
the increase in retransmission consent fees from 2015 to 2016 as reported in the 2017 survey.

2018 Communications Marketplace Report

Video and Audio Appendices

annual rate of increase was 42.3 percent and 37.8 percent for retransmission consent fees and fees per
subscriber, respectively.

Table 11
Change in Retransmission Consent Fees
2013-2016
Year

Retransmission Consent
Fee Index

Retransmission Consent
Fees per Subscriber Index
100
163.2
218.5
287.9

2013
2014
2015
2016

100
150.0
201.2
261.6

Compound Average Annual Rate of Change
2013-2016

42.3%

37.8%

38.
Table 12 reports information on retransmission consent fees by system size. The
noncompetitive, incumbent, and rival subgroup communities were added to the system size subgroups
detailed in the Appendix. As before, a small system has 10,000 or fewer subscribers; a midsize system has
10,001 to 75,000 subscribers; and a large system has more than 75,000 subscribers. Table 12 shows that
retransmission consent fees are higher for small systems. On average, small systems paid $93.37 annually
per subscriber in 2016, while midsize and large systems paid $71.22 and $70.88, respectively. The
differences in fees paid per subscriber between small and midsize systems and between small and large
systems are statistically significant (see Attachment 15). However, the difference in fees paid per
subscriber between midsize and large systems is not statistically significant. Small systems also carry
fewer stations pursuant to retransmission consent than midsize and large systems, and therefore, when
retransmission consent fees are calculated per subscriber per station, fees are again highest for small
systems. Midsize systems carry about one fewer station under retransmission consent than large systems,
and, consequently, have higher fees than large systems when retransmission consent fees are calculated
per subscriber, per station.
Table 12
Retransmission Consent Fees by System Size
2016

Average Annual Retransmission Consent Fees Paid
per Subscriber
Annual Change
Average Number of Stations Carried under
Retransmission Consent per Cable System
Annual Change
Average Monthly Retransmission Consent Fees Paid
per Subscriber per Station

Small
Systems

Midsize
Systems

Large
Systems

$93.37

$71.22

$70.88

19.9%*

27.8%*

33.2%*

7.56

11.06

11.99

2.3%

2.1%

2.8%

$1.20

$0.64

$0.55

20.4%*
26.5%*
27.4%*
Annual Change
Source: 2017 survey. * Indicates annual change is statistically significant at the 95% confidence level. See
Attachment 15 for comparisons of retransmission consent fees between system size groups.

2018 Communications Marketplace Report

IV.

Video and Audio Appendices

CONCLUSIONS

39.
Cable service prices increased over the period covered by this report. Basic service
prices grew 5.2 percent, while prices for expanded basic service increased by 3.2 percent over the 12
months ending January 1, 2017. These price increases are larger than the 2.5 percent increase in general
inflation as measured by the CPI (All Items) for the same one-year period. Over the five-year period,
2012-2017, on average basic service prices increased by 4.0 percent annually and expanded basic service
prices increased by 4.1 percent annually, while the average annual increase in inflation was 1.4 percent
over the same period.
40.
Basic service prices were about 50 percent higher in effective competition communities
than in noncompetitive communities (where basic service rates may be subject to regulation by local
franchising authorities), while expanded basic service prices were slightly lower in effective competition
communities. Expanded basic price per channel, however, was about 25 percent higher in effective
competition communities.
41.
Annual retransmission consent fees paid by cable systems to television broadcasters
increased by about 30 percent from 2015 to 2016 on average. Average annual retransmission consent
fees paid by cable systems to television broadcast stations calculated on a per-subscriber basis increased
from $55.82 to $72.59 over the same period. During the 2013-2016 period, the average annual increase
in retransmission consent fees was 42.3 percent, and the average annual increase in fees per subscriber
was 37.8 percent. Small system operators pay about 30 percent more in retransmission consent fees
calculated on a per subscriber basis than midsize and large system operators.
42.
DBS providers offer programming services similar to those offered by cable operators.
Accordingly, the Report compared expanded basic service to the DBS services found to be the most
comparable. As of January 1, 2017, the average price of expanded basic ($75.21) was less than the
average price for DIRECTV’s Choice package ($78.99), and slightly more than DISH’s AT120+
($74.99). Cable operators, on average, offered 195 channels with expanded basic service, while the
comparable services of DIRECTV and DISH offered 239 and 182 channels respectively. Expanded basic
service had, on average, a higher price per channel (49 cents per channel) than DIRECTV’s service (33
cents per channel) and DISH’s service (41 cents per channel).

2018 Communications Marketplace Report

Video and Audio Appendices

Attachment 1
Cable Price Survey
Sampling Groups
January 1, 2017
Number
of Cable
Communities

Sampling Groups
and Subgroups

Percent of
National
Subscribers

Survey
Sample
Size

Number
of Survey
Responses

33
717
750

33
713
746

Sampling Groups
Noncompetitive group
Effective competition
Full sample

118
33,765
33,883

1.3%
98.7%
100%

Effective Competition Subgroups
Large Systems: More than 75,000
subscribers
Midsize Systems: 10,001 – 75,000
subscribers
Small Systems: 10,000 and fewer
subscribers
Incumbents
Rivals

8,837

49.3%

230

10,252

28.8%

200

13,374

7.3%

175

171

745
557

10.0%
3.3%

56
56

Sources: Federal Communications Commission, Cable Community Registration, FCC Form 322; Annual Cable
Operator Report, FCC Form 325, and S&P Global, MediaCensus, Operator Subscribers by Geography 2016 Q3. See
47 CFR §§ 76.1801, 403. The Commission assigns a “cable community unit identifier” (CUID) to each registered
cable operator for each individual community the operator serves. In cable overbuild communities, the table shows
more incumbents than rivals. This is primarily because the communities of one rival, AT&T, do not have CUIDs.
The Commission however considers AT&T U-verse as a competing service for the purpose of findings of effective
competition.

2018 Communications Marketplace Report

Video and Audio Appendices

Attachment 2
Average Price of Programming
by Subgroup and Programming Service
Sample
Group

Subgroup

Service
Basic service

Full sample

---

Expanded basic
Next most popular

Noncompetitive
Group

Basic service
---

Expanded basic
Next most popular
Basic service

---

Expanded basic
Next most popular
Basic service

Overbuilt
Communities
incumbents

Expanded basic
Next most popular
Basic service

Effective
Competition
Group

Overbuilt
Communities
rivals

Expanded basic
Next most popular
Basic service

Small
Systems

Expanded basic
Next most popular
Basic service

Midsize
Systems

Expanded basic
Next most popular
Basic service

Large
Systems

Expanded basic
Next most popular

Year

Sample
Mean

Standard
Error

2017
2016
2017
2016
2017
2016
2017
2016
2017
2016
2017
2016
2017
2016
2017
2016
2017
2016
2017
2016
2017
2016
2017
2016
2017
2016
2017
2016
2017
2016
2017
2016
2017
2016
2017
2016
2017
2016
2017
2016
2017
2016
2017
2016
2017
2016
2017
2016

746
737
746
737
736
727
33
33
33
33
33
33
713
704
713
704
703
694
56
56
56
56
56
56
56
55
56
55
55
54
171
171
171
171
162
162
200
200
200
200
200
200
230
222
230
222
230
222

$25.06
$23.81
$75.21
$72.90
$89.28
$86.82
$16.61
$15.13
$77.24
$74.54
$93.28
$90.59
$25.17
$23.93
$75.19
$72.87
$89.23
$86.77
$23.02
$20.98
$72.87
$71.15
$85.34
$83.38
$17.98
$17.44
$72.40
$71.33
$85.94
$84.30
$30.41
$29.63
$71.73
$69.15
$84.68
$82.11
$26.91
$25.52
$75.35
$72.88
$90.14
$87.50
$24.31
$23.18
$76.25
$73.89
$90.32
$87.86

0.265
0.266
0.261
0.226
0.377
0.315
0.215
0.228
0.721
0.536
0.981
0.786
0.269
0.270
0.264
0.229
0.381
0.319
0.500
0.620
0.720
0.547
1.016
0.824
0.988
0.875
0.717
0.875
1.696
1.438
0.753
0.696
0.721
0.680
0.896
0.790
0.363
0.380
0.525
0.455
0.677
0.586
0.458
0.457
0.384
0.333
0.587
0.484

Annual
Change
5.2%*
3.2%*
2.8%*
9.8%*
3.6%*
3.0%*
5.2%*
3.2%*
2.8%*
9.7%*
2.4%
2.4%
3.1%
1.5%
1.9%
2.6%
3.7%*
3.1%*
5.5%*
3.4%*
3.0%*
4.9%
3.2%*
2.8%*

Source: 2017 survey. * Indicates annual change is statistically significant at the 95% confidence level. Price does
not include equipment, unless the operator bundles the programming service and equipment in a single price.

2018 Communications Marketplace Report

Video and Audio Appendices

Attachment 3
Differences between Subgroups: Average Price of Programming
January 1, 2017
Service

Subgroup 1

Average
Price 1

Basic
Expanded Basic
Next Most Popular

Large
Systems

$24.31

Midsize
Systems

$26.91

Small
Systems

$30.41

Incumbent

$23.02

Rival

$17.98

Large
Systems

$76.25

Midsize
Systems

$75.35

Small
Systems

$71.73

Incumbent

$72.87

Rival

$72.40

Large
Systems

$90.32

Midsize
Systems

$90.14

Small
Systems

$84.68

Incumbent

$85.34

Rival
Source: 2017 survey.

$85.94

Subgroup 2
Midsize
Small
Incumbent
Rival
Noncompetitive
Small
Incumbent
Rival
Noncompetitive
Incumbent
Rival
Noncompetitive
Rival
Noncompetitive
Noncompetitive
Midsize
Small
Incumbent
Rival
Noncompetitive
Small
Incumbent
Rival
Noncompetitive
Incumbent
Rival
Noncompetitive
Rival
Noncompetitive
Noncompetitive
Midsize
Small
Incumbent
Rival
Noncompetitive
Small
Incumbent
Rival
Noncompetitive
Incumbent
Rival
Noncompetitive
Rival
Noncompetitive
Noncompetitive

Average
Price 2

Is Difference
Statistically Significant?

$26.91
$30.41
$23.02
$17.98
$16.61
$30.41
$23.02
$17.98
$16.61
$23.02
$17.98
$16.61
$17.98
$16.61
$16.61
$75.35
$71.73
$72.87
$72.40
$77.24
$71.73
$72.87
$72.40
$77.24
$72.87
$72.40
$77.24
$72.40
$77.24
$77.24
$90.14
$84.68
$85.34
$85.94
$93.28
$84.68
$85.34
$85.94
$93.28
$85.34
$85.94
$93.28
$85.94
$93.28
$93.28

Yes
Yes
No
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
No
No
Yes
Yes
Yes
No
Yes
Yes
Yes
No
No
No
Yes
No
Yes
Yes
No
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
No
No
Yes
No
Yes
Yes

2018 Communications Marketplace Report

Video and Audio Appendices

Attachment 4
Average Price of Cable Programming and Equipment (Total Price)
by Subgroup and Programming Service
Sample
Group

Subgroup

Service
Basic service

Full sample

---

Expanded basic
Next most popular

Noncompetitive
Group

Basic service
---

Expanded basic
Next most popular
Basic service

---

Expanded basic
Next most popular

Overbuilt
Communities
incumbents

Effective
Competition
Group

Overbuilt
Communities
rivals

Basic service
Expanded basic
Next most popular
Basic service
Expanded basic
Next most popular
Basic service

Small
Systems

Expanded basic
Next most popular
Basic service

Midsize
Systems

Expanded basic
Next most popular
Basic service

Large
Systems

Expanded basic
Next most popular

Year

Sample
Mean

Standard
Error

746
737
746
737
736
727
33
33
33
33
33
33
713
704
713
704
703
694
56
56
56
56
56
56
56
55
56
55
55
54
171
171
171
171
162
162
200
200
200
200
200
200
230
222
230
222
230
222

$30.73
$29.28
$81.01
$78.51
$95.13
$92.50
$18.96
$17.45
$79.58
$76.86
$95.63
$92.91
$30.88
$29.44
$81.02
$78.54
$95.12
$92.49
$30.99
$28.37
$80.84
$78.68
$93.50
$91.10
$27.85
$27.31
$82.87
$81.80
$96.86
$95.22
$36.37
$35.40
$78.03
$75.25
$91.79
$89.09
$31.59
$30.12
$80.17
$77.62
$95.07
$92.36
$29.86
$28.50
$81.86
$79.32
$95.81
$93.16

0.245
0.267
0.232
0.244
0.292
0.253
0.404
0.476
0.399
0.261
0.642
0.458
0.248
0.270
0.235
0.247
0.296
0.256
0.431
0.583
0.527
0.455
0.795
0.649
0.652
0.539
0.895
1.077
1.532
1.283
0.852
0.816
0.762
0.765
0.875
0.805
0.427
0.456
0.462
0.446
0.534
0.467
0.392
0.434
0.343
0.386
0.444
0.384

Annual
Change
5.0%*
3.2%*
2.8%*
8.7%*
3.5%*
2.9%*
4.9%*
3.2%*
2.8%*
9.2%*
2.8%*
2.6%*
2.0%
1.3%
1.7%
2.7%
3.7%*
3.0%*
4.9%*
3.3%*
2.9%*
4.8%*
3.2%*
2.8%*

Source: 2017 survey. * Indicates annual change is statistically significant at the 95% confidence level. Equipment
price added to programming price if equipment is necessary to receive all channels.

2018 Communications Marketplace Report

Video and Audio Appendices

Attachment 5
Differences between Subgroups: Average Total Price*
January 1, 2017
Service

Subgroup 1

Total
Price 1

Subgroup 2

Total
Price 2

Is Difference Statistically
Significant?

Basic

Midsize
$31.59
Yes
Small
$36.37
Yes
Large Systems
$29.86
Incumbent
$30.99
No
Rival
$27.85
Yes
Noncompetitive
$18.96
Yes
Small
$36.37
Yes
Incumbent
$30.99
No
Midsize Systems
$31.59
Rival
$27.85
Yes
Noncompetitive
$18.96
Yes
Incumbent
$30.99
Yes
Small Systems
$36.37
Rival
$27.85
Yes
Noncompetitive
$18.96
Yes
Rival
$27.85
Yes
Incumbent
$30.99
Noncompetitive
$18.96
Yes
Rival
$27.85
Noncompetitive
$18.96
Yes
Midsize
$80.17
Yes
Small
$78.03
Yes
Large Systems
$81.86
Incumbent
$80.84
No
Rival
$82.87
No
Noncompetitive
$79.58
Yes
Small
$78.03
Yes
Incumbent
$80.84
No
Midsize Systems
$80.17
Rival
$82.87
Yes
Noncompetitive
$79.58
No
Incumbent
$80.84
Yes
Small Systems
$78.03
Rival
$82.87
Yes
Noncompetitive
$79.58
No
Rival
$82.87
No
Incumbent
$80.84
Noncompetitive
$79.58
No
Rival
$82.87
Noncompetitive
$79.58
Yes
Midsize
$95.07
No
Small
$91.79
Yes
Large Systems
$95.81
Incumbent
$93.50
Yes
Rival
$96.86
No
Noncompetitive
$95.63
No
Small
$91.79
Yes
Incumbent
$93.50
No
Midsize Systems
$95.07
Rival
$96.86
No
Noncompetitive
$95.63
No
Incumbent
$93.50
No
Small Systems
$91.79
Rival
$96.86
Yes
Noncompetitive
$95.63
Yes
Rival
$96.86
No
Incumbent
$93.50
Noncompetitive
$95.63
No
Rival
$96.86
Noncompetitive
$95.63
No
Source: 2017 survey. * As with Attachment 4, “Average Total Price” refers to average price of cable programming
and equipment.

Expanded Basic
Next Most Popular

2018 Communications Marketplace Report

Video and Audio Appendices

Attachment 6
Average Price per Channel
by Subgroup and Programming Service
Sample
Group

Subgroup

Service
Basic service

Full sample

---

Expanded basic
Next most popular

Noncompetitive
Group

Basic service
---

Expanded basic
Next most popular
Basic service

---

Expanded basic
Next most popular
Basic service

Overbuilt
Communities
incumbents

Expanded basic
Next most popular
Basic service

Effective
Competition
Group

Overbuilt
Communities
rivals

Expanded basic
Next most popular
Basic service

Small
Systems

Expanded basic
Next most popular
Basic service

Midsize
Systems

Expanded basic
Next most popular
Basic service

Large
Systems

Expanded basic
Next most popular

Year

Sample
Mean

Standard
Error

746
737
746
737
736
727
33
33
33
33
33
33
713
704
713
704
703
694
56
56
56
56
56
56
56
55
56
55
55
54
171
171
171
171
162
162
200
200
200
200
200
200
230
222
230
222
230
222

$0.58
$0.65
$0.49
$0.54
$0.37
$0.40
$0.30
$0.31
$0.39
$0.41
$0.34
$0.33
$0.59
$0.65
$0.49
$0.54
$0.38
$0.40
$0.45
$0.46
$0.54
$0.59
$0.38
$0.39
$0.58
$0.57
$0.39
$0.38
$0.30
$0.29
$1.33
$1.37
$0.83
$0.83
$0.64
$0.64
$0.63
$0.70
$0.49
$0.54
$0.39
$0.41
$0.48
$0.56
$0.44
$0.51
$0.34
$0.38

0.012
0.015
0.008
0.010
0.005
0.005
0.008
0.017
0.008
0.011
0.003
0.005
0.012
0.015
0.008
0.010
0.005
0.005
0.018
0.023
0.014
0.017
0.008
0.009
0.034
0.032
0.034
0.016
0.009
0.008
0.067
0.068
0.041
0.040
0.023
0.023
0.024
0.030
0.018
0.020
0.011
0.012
0.015
0.021
0.010
0.014
0.005
0.007

Annual
Change
-10.1%*
-10.1%*
-6.4%*
-3.7%
-5.4%
1.7%
-10.2%*
-10.2%*
-6.5%*
-2.1%
-8.4%*
-3.0%
1.4%
3.3%
1.3%
-2.5%
-0.2%
-0.6%
-10.4%
-8.7%
-4.9%
-14.3%*
-14.3%*
-9.8%*

Source: 2017 survey. * Indicates annual change is statistically significant at the 95% confidence level. Price per
channel is equal to sum of the programming price and the price of the most commonly leased equipment divided by
the number of channels the service offers.

2018 Communications Marketplace Report

Video and Audio Appendices

Attachment 7
Differences between Subgroups: Average Price per Channel
January 1, 2017
Service

Subgroup 1

Price per
Channel 1

Basic
Expanded Basic
Next Most Popular

Large Systems

$0.48

Midsize Systems

$0.63

Small Systems

$1.33

Incumbent

$0.45

Rival

$0.58

Large Systems

$0.44

Midsize Systems

$0.49

Small Systems

$0.83

Incumbent

$0.54

Rival

$0.39

Large Systems

$0.34

Midsize Systems

$0.39

Small Systems

$0.64

Incumbent

$0.38

Rival
Source: 2017 survey.

$0.30

Price per
Channel 2

Is Difference Statistically
Significant?

$0.63
$1.33
$0.45
$0.58
$0.30
$1.33
$0.45
$0.58
$0.30
$0.45
$0.58
$0.30
$0.58
$0.30
$0.30
$0.49
$0.83
$0.54
$0.39
$0.39
$0.83
$0.54
$0.39
$0.39
$0.54
$0.39
$0.39
$0.39
$0.39
$0.39
$0.39
$0.64
$0.38
$0.30
$0.34
$0.64
$0.38
$0.30
$0.34
$0.38
$0.30
$0.34
$0.30
$0.34
$0.34

Yes
Yes
No
Yes
Yes
Yes
Yes
No
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
No
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
No
Yes
Yes
Yes
Yes
No
Yes
No
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes

2018 Communications Marketplace Report

Video and Audio Appendices

Attachment 8
Historical Price Series
1995-2017
Expanded Basic Service
Price per
Channels
Channel
No.
Index Dollars Index

CPI

Next Most
Popular
Service and
Equipment

All
Items

Cable

100.0

---

1000

100.0

$0.610

101.7

---

103.0

106.9

112.3

$0.630

105.0

---

105.2

114.9

113.9

$0.650

108.3

$38.58

107.0

122.6

Basic
Service
Price

Price

Jul. 1995

---

$22.35

44.0

100.0

$0.600

Jul. 1996

---

$24.28

47.0

106.8

Jul. 1997

---

$26.31

49.4

Jul. 1998

$12.06

$27.88

50.1

Jul. 1999

$12.58

$28.94

51.1

116.1

$0.650

108.3

$38.43

109.3

127

Jul. 2000

$12.84

$31.22

54.8

124.5

$0.660

110.0

$39.64

113.3

132.9

Jul. 2001

$12.84

$33.75

59.4

135.0

$0.600

100.0

$45.33

116.4

139.1

Jul. 2002

$14.45

$36.47

62.7

142.5

$0.660

110.0

$46.59

118.1

147.8

Jan. 2003

$13.45

$38.95

67.5

153.4

$0.650

108.3

$49.03

121.2

157.1

Jan. 2004

$13.80

$41.04

70.3

159.8

$0.660

110.0

$51.76

123.5

163.1

Jan. 2005

$14.30

$43.04

70.5

160.2

$0.620

103.3

$56.03

127.2

169.6

Jan. 2006

$14.59

$45.26

71.0

161.4

$0.650

108.3

$59.09

132.2

174.4

Jan. 2007

$15.33

$47.27

72.6

165.0

$0.670

111.7

$60.27

135.0

179.0

Jan. 2008

$16.11

$49.65

72.8

165.5

$0.680

113.3

$63.66

140.8

183.9

Jan. 2009

$17.65

$52.37

78.2

177.7

$0.710

118.3

$67.92

140.8

186.5

Jan. 2010

$17.93

$54.44

117.0

204.7

$0.560

110.3

$71.39

144.5

191.9

Jan. 2011

$19.33

$57.46

124.2

217.3

$0.569

112.0

$75.37

146.9

192.0

Jan. 2012

$20.55

$61.63

149.9

262.2

$0.505

99.4

$78.91

151.2

199.8

Jan. 2013

$22.63

$64.41

159.6

279.2

$0.484

95.3

$81.64

153.6

206.5

Jan. 2014

$22.78

$66.61

167.3

292.6

$0.496

97.6

$84.65

156.0

212.0

Jan. 2015

$23.79

$69.03

181.3

317.1

$0.456

89.3

$86.83

155.8

216.4

Jan. 2016

$25.40

$71.37

181.0

316.5

$0.469

91.8

$90.42

158.0

220.1

Jan. 2017

$25.06

$75.21

195.1

341.3

$0.487

95.4

$95.13

161.9

231.7

-0.8%

3.8%

1.4%

3.0%

-1.6%

4.7%

1.8%

2.6%

-0.2%

---

2.2%

3.9%

Year

Compound Average Annual Rate of Change
5 year average

4.0%

4.1%

10 year average

5.0%

4.8%

---

5.7%

1995-2017

---

5.4%

---

7.5%
---

5.7%

---

Sources: 1995-2017 survey reports. See supra note 2. Consumer price indices (CPIs) are from BLS, Department of
Labor, Consumer Price Index, All Urban Consumers, U.S. City Average, Not Seasonally Adjusted, All Items (198284=100). Series ID: CUUR0000SA0. (Accessed February 21, 2018); Series ID: CUUR0000SERA02 (accessed
February 21, 2018). We re-based these CPI series to July 1995 = 100 for the purpose of this report. This attachment is
described in the Methodology Appendix.

2018 Communications Marketplace Report

Video and Audio Appendices

Attachment 9
Average Number of Channels
by Sample and Programming Service
Sample
Group

Subgroup

Service
Basic service

Full sample

---

Expanded basic
Next most popular
Basic service

Noncompetitive
Group

---

Expanded basic
Next most popular
Basic service

---

Expanded basic
Next most popular
Basic service

Overbuilt
Communities
incumbents

Expanded basic
Next most popular
Basic service

Effective
Competition
Group

Overbuilt
Communities
rivals

Expanded basic
Next most popular
Basic service

Small
Systems

Expanded basic
Next most popular
Basic service

Midsize
Systems

Expanded basic
Next most popular
Basic service

Large
Systems

Expanded basic
Next most popular

Year

Sample
Mean

Standard
Error

746
737
746
737
736
727
33
33
33
33
33
33
713
704
713
704
703
694
56
56
56
56
56
56
56
55
56
55
55
54
171
171
171
171
162
162
200
200
200
200
200
200
230
222
230
222
230
222

67.2
59.6
195.1
173.4
281.7
257.6
65.2
63.8
211.8
192.6
285.7
284.9
67.3
59.5
194.9
173.2
281.7
257.3
83.6
86.7
169.1
170.8
263.6
258.0
57.4
57.0
241.9
230.3
336.0
333.0
36.6
35.3
122.5
113.8
173.5
163.9
60.2
54.4
192.5
172.1
272.3
253.3
73.2
60.8
208.8
179.3
302.0
267.6

1.227
1.039
2.494
2.190
3.134
2.724
1.073
1.806
3.566
2.876
1.285
2.968
1.243
1.053
2.526
2.219
3.175
2.760
4.664
5.731
6.390
6.647
8.239
9.021
1.616
1.645
5.919
5.242
5.274
5.175
1.744
1.777
4.418
3.674
5.782
4.976
1.677
1.623
4.220
3.750
5.082
4.794
2.008
1.363
4.047
3.535
5.092
4.213

Source: 2017 survey.

Annual
Change
12.8%*
12.5%*
9.4%*
2.2%
10.0%*
0.3%
13.0%*
12.5%*
9.5%*
-3.6%
-1.0%
2.2%
0.6%
5.1%
0.9%
3.9%
7.7%
5.9%
10.6%*
11.9%*
7.5%*
20.4%*
16.5%*
12.9%*

2018 Communications Marketplace Report

Video and Audio Appendices

Attachment 10
Differences between Subgroups: Average Number of Channels
January 1, 2017
Service

Subgroup 1

Number of
Channels 1

Basic
Expanded Basic

Large
Systems

73.2

Midsize
Systems

60.2

Small
Systems

36.6

Incumbent

83.6

Rival

57.4

Large
Systems

208.8

Midsize
Systems

192.5

Small
Systems

122.5

Next Most Popular

Incumbent

169.1

Rival

241.9

Large
Systems

302.0

Midsize
Systems

272.3

Small
Systems

173.5

All Channels

Incumbent

263.6

Rival

336.0

Large
Systems

541.9

Midsize
Systems

486.4

Small
Systems

329.2

Incumbent

552.3

Rival
Source: 2017 survey.

577.2

Number of
Channels 2

Is Difference
Statistically Significant?

60.2
36.6
83.6
57.4
65.2
36.6
83.6
57.4
65.2
83.6
57.4
65.2
57.4
65.2
65.2
192.5
122.5
169.1
241.9
211.8
122.5
169.1
241.9
211.8
169.1
241.9
211.8
241.9
211.8
211.8
272.3
173.5
263.6
336.0
285.7
173.5
263.6
336.0
285.7
263.6
336.0
285.7
336.0
285.7
285.7
486.4
329.2
552.3
577.2
500.7
329.2
552.3
577.2
500.7
552.3
577.2
500.7
577.2
500.7
500.7

Yes
Yes
No
Yes
Yes
Yes
Yes
No
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
No
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
No
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
No
Yes
Yes
Yes
Yes
Yes
No
Yes
Yes
Yes
No
Yes
Yes

2018 Communications Marketplace Report

Video and Audio Appendices

Attachment 11
Differences between Subgroups: Channel Composition
January 1, 2017
Channel
Type

Subgroup 1

Number of
Channels 1

Broadcast
PEG
Leased Access
Regional Sports Networks

Large
Systems

41.3

Midsize
Systems

32.6

Small
Systems

17.8

Incumbent

40.9

Rival

47.3

Large
Systems

5.7

Midsize
Systems

3.6

Small
Systems

2.1

Incumbent

4.4

Rival

5.0

Large
Systems

1.5

Midsize
Systems

1.1

Small
Systems

0.5

Incumbent

1.6

Rival

0.5

Large
Systems

0.1

Midsize
Systems

0.1

Small
Systems

0.1

Incumbent

1.5

Rival
Source: 2017 survey

0.0

Number of
Channels 2

Is Difference Statistically
Significant?

32.6
17.8
40.9
47.3
40.5
17.8
40.9
47.3
40.5
40.9
47.3
40.5
47.3
40.5
40.5
3.6
2.1
4.4
5.0
3.2
2.1
4.4
5.0
3.2
4.4
5.0
3.2
5.0
3.2
3.2
1.1
0.5
1.6
0.5
1.0
0.5
1.6
0.5
1.0
1.6
0.5
1.0
0.5
1.0
1.0
0.1
0.1
1.5
0.0
0.0
0.1
1.5
0.0
0.0
1.5
0.0
0.0
0.0
0.0
0.0

Yes
Yes
No
Yes
No
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
No
Yes
Yes
Yes
Yes
No
Yes
Yes
Yes
Yes
No
Yes
Yes
Yes
No
Yes
Yes
Yes
Yes
No
Yes
Yes
Yes
Yes
Yes
No
Yes
No
Yes
Yes
Yes
Yes
No
No
Yes
Yes
Yes
No
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes

2018 Communications Marketplace Report

Video and Audio Appendices

Attachment 12
Differences between Subgroups: Regional Sports Networks
January 1, 2017
Service

Subgroup 1

Number of
RSNs 1

Basic
Expanded Basic
Next Most Popular

Large
Systems

0.1

Midsize
Systems

0.1

Small
Systems

0.1

Incumbent

1.5

Rival

0.0

Large
Systems

3.1

Midsize
Systems

3.5

Small
Systems

2.2

Incumbent

3.3

Rival

7.1

Large
Systems

3.6

Midsize
Systems

3.6

Small
Systems

2.4

Incumbent

3.3

Rival
Source: 2017 survey

8.0

Number of
RSNs 2
0.1
0.1
1.5
0.0
0.0
0.1
1.5
0.0
0.0
1.5
0.0
0.0
0.0
0.0
0.0
3.5
2.2
3.3
7.1
4.5
2.2
3.3
7.1
4.5
3.3
7.1
4.5
7.1
4.5
4.5
3.6
2.4
3.3
8.0
4.5
2.4
3.3
8.0
4.5
3.3
8.0
4.5
8.0
4.5
4.5

Is Difference Statistically
Significant?
No
No
Yes
Yes
Yes
No
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
No
Yes
No
Yes
Yes
Yes
No
Yes
No
Yes
Yes
Yes
Yes
Yes
Yes
No
Yes
No
Yes
No
Yes
No
Yes
No
Yes
Yes
Yes
Yes
Yes
Yes

2018 Communications Marketplace Report

Video and Audio Appendices

Attachment 13
Average Equipment Lease Fee
by Subgroup and Programming Service
Sample
Group

Subgroup

Service
Basic service

Full sample

---

Expanded basic
Next most popular

Noncompetitive
Group

Basic service
---

Expanded basic
Next most popular
Basic service

---

Expanded basic
Next most popular

Overbuilt
Communities
incumbents

Effective
Competition
Group

Overbuilt
Communities
rivals

Basic service
Expanded basic
Next most popular
Basic service
Expanded basic
Next most popular
Basic service

Small
Systems

Expanded basic
Next most popular
Basic service

Midsize
Systems

Expanded basic
Next most popular
Basic service

Large
Systems

Expanded basic
Next most popular

Year

Sample
Mean

Standard
Error

472
458
479
467
482
474
11
11
11
11
11
11
461
447
468
456
471
463
45
44
45
45
46
46
53
52
53
52
55
54
116
114
122
120
125
126
110
109
111
110
111
111
137
128
137
129
134
126

$9.17
$9.02
$9.29
$9.15
$9.38
$9.21
$7.11
$7.01
$7.10
$7.01
$7.11
$7.01
$9.18
$9.04
$9.31
$9.17
$9.39
$9.22
$9.63
$9.10
$9.63
$9.09
$9.67
$9.15
$10.33
$10.33
$10.95
$10.96
$10.92
$10.92
$8.78
$8.65
$8.83
$8.70
$9.21
$8.98
$8.51
$8.44
$8.69
$8.62
$8.88
$8.76
$9.36
$9.27
$9.46
$9.38
$9.45
$9.37

0.125
0.124
0.115
0.114
0.111
0.110
0.103
0.023
0.104
0.023
0.103
0.023
0.125
0.125
0.116
0.114
0.112
0.111
0.128
0.109
0.128
0.107
0.134
0.119
0.372
0.378
0.207
0.210
0.204
0.207
0.427
0.394
0.406
0.375
0.369
0.340
0.296
0.276
0.288
0.268
0.263
0.247
0.187
0.198
0.166
0.175
0.170
0.179

Annual
Change
1.6%
1.6%
1.8%
1.3%
1.3%
1.3%
1.6%
1.6%
1.8%
5.7%*
5.9%*
5.7%*
-0.1%
-0.1%
0.0%
1.5%
1.5%
2.6%
0.8%
0.8%
1.4%
0.9%
0.9%
0.9%

Source: 2017 survey. * Indicates the annual change is statistically significant at the 95% confidence level.
Equipment refers to a set-top converter box or other digital gateway. The average equipment lease fees reported are
the average fees for operators who priced cable service and equipment separately Because features vary, differences
in price may reflect quality differences.

2018 Communications Marketplace Report

Video and Audio Appendices

Attachment 14
Differences between Subgroups: Average Equipment Lease Fee
January 1, 2017
Service

Subgroup 1

Lease Fee
1

Basic
Expanded Basic
Next Most Popular

Large
Systems

$9.36

Midsize
Systems

$8.51

Small
Systems

$8.78

Incumbent

$9.63

Rival

$10.33

Large
Systems

$9.46

Midsize
Systems

$8.69

Small
Systems

$8.83

Incumbent

$9.63

Rival

$10.95

Large
Systems

$9.45

Midsize
Systems

$8.88

Small
Systems

$9.21

Incumbent

$9.67

Rival
Source: 2017 survey.

$10.92

Lease Fee
2

Is Difference Statistically
Significant?

$8.51
$8.78
$9.63
$10.33
$7.11
$8.78
$9.63
$10.33
$7.11
$9.63
$10.33
$7.11
$10.33
$7.11
$7.11
$8.69
$8.83
$9.63
$10.95
$7.10
$8.83
$9.63
$10.95
$7.10
$9.63
$10.95
$7.10
$10.95
$7.10
$7.10
$8.88
$9.21
$9.67
$10.92
$7.11
$9.21
$9.67
$10.92
$7.11
$9.67
$10.92
$7.11
$10.92
$7.11
$7.11

Yes
No
No
Yes
Yes
No
Yes
Yes
Yes
No
Yes
Yes
No
Yes
Yes
Yes
No
No
Yes
Yes
No
Yes
Yes
Yes
No
Yes
Yes
Yes
Yes
Yes
No
No
No
Yes
Yes
No
Yes
Yes
Yes
No
Yes
Yes
Yes
Yes
Yes

2018 Communications Marketplace Report

Video and Audio Appendices

Attachment 15
Differences between System Size Groups: Retransmission Consent
2016
Size Group 1

Fees per
Subscriber 1

Small Systems

$93.37

Midsize Systems

$71.22

Size Group 1

Number of
Stations 1

Small Systems

7.56

Midsize Systems

11.06

Size Group 1

Fees per
Subscriber per
Station 1

Small Systems

$1.20

Midsize Systems

$0.64

Size Group 2
Midsize Systems
Large Systems
Large Systems
Size Group 2
Midsize Systems
Large Systems
Large Systems
Size Group 2

Midsize Systems
Large Systems
Large Systems

Fees per
Subscriber 2

Is Difference Statistically
Significant?

$71.22
$70.88
$70.88

Yes
Yes
No

Number of
Stations 2

Is Difference Statistically
Significant?

11.06
11.99
11.99

Yes
Yes
Yes

Fees per
Subscriber per
Station 2

Is Difference Statistically
Significant?

$0.64
$0.55
$0.55

Yes
Yes
Yes

2018 Communications Marketplace Report

Video and Audio Appendices

Attachment 16
Comparison of Cable to DBS Averages
Price, Channels, and Price per Channel
January 2017
Statistic
Mean price of programming
Number of sample observations
Standard error of the mean
Independent samples t-statistic

Cable
Expanded
Basic Service

DBS
DIRECTV
Choice Service

$75.21
746
0.261
---

$78.99
40
0.000
14.483

Mean number of video channels
Number of sample observations
Standard error of the mean
Independent samples t-statistic
Mean price per channel
Number of sample observations
Standard error of the mean
Independent samples t-statistic
Mean no. of broadcast channels
Number of sample observations
Standard error of the mean

195.1
746
2.494
--0.49
746
0.008
--37.2
746

238.9
40
1.495
15.989
0.331
40
0.002
-72.632
19.7
40
1.464

Mean number of other channels
Number of sample observations
Standard error of the mean

157.9
746

219.2
40
0.084

DBS
DISH Network
America’s Top 120 Plus
$74.99
40
0.000
-0.843

182.2
40
1.372
-4.836
0.413
40
0.003
-24.859
21.0
40
1.342
161.2
40
0.084

* The difference in the cable and DBS means is statistically significant at the 95-percent confidence level.
Notes: This table is discussed in Section I(A) of the Report. Data in the column “Cable Expanded Basic Service”
are from Attachments 2, 6 and 9, and Tables 5 and 6 of the Report. The DIRECTV data are from DIRECTV
Group Holdings LLC (DIRECTV). http://www.directv.com. The DISH data are from DISH NETWORK
Corporation (DISH). http://www.dish.com. DIRECTV and DISH prices became effective, respectively on Jan.
22, 1017 and Jan. 16, 2017.
.

2018 Communications Marketplace Report

Video and Audio Appendices

APPENDIX B-1.1
Survey Methodology
A.

Sampling Procedure

1.
We conducted the 2017 survey to fulfill the reporting requirements of the Cable Act. 50
We selected communities nationwide at random to be part of the survey sample. 51 In choosing our
sample, we divided the communities into two groups: an effective competition group and a
noncompetitive group. 52 We divided the effective competition group into strata or subgroups and selected
a sample of communities from each stratum. The noncompetitive group was not divided into subgroups;
instead, the sample was selected from the full noncompetitive group. For each community, we asked the
operator to complete a survey questionnaire on the prices charged for video programming service
offerings as well as other aspects of the operator’s system. We used the information collected to estimate
and compare mean prices, and other statistics, across the different strata of communities.
2.
The survey divided the effective competition group into strata to compare subgroups of
communities and to achieve desirable levels of statistical precision. We stratified the effective
competition communities into five strata. Two of the strata consisted of operators in cable overbuild
locales – locations where an effective competition finding was made on the basis of the presence of a
second “rival” cable operator. The first stratum consisted of incumbent operators and the second
consisted of the rival cable operators in these overbuild areas. Cable operators in the incumbent stratum
have sometimes cited municipals as rivals. Municipals cited as such are included in this rival stratum and
a number are included in our survey. Other municipals, in communities where the Commission did not
make a finding, are in the effective competition group, generally within the small system stratum,
discussed below, and are also in our sample. Some incumbents in overbuild areas cited AT&T U-verse as
a rival service; however the survey did not collect prices of U-verse, because these systems are not
registered cable operators with the Commission. The Commission, however, considers U-verse as a
competing service for assessing effective competition.
3.
Because there is a positive correlation between system size and price, the remaining
effective competition communities were stratified according to the size of the cable system. Doing so
creates strata in which prices are less disparate than in the full group and tends to increase the efficiency
of sampling through reducing sampling variance. 53 We define small systems as cable systems serving
10,000 or fewer subscribers, midsize systems as cable systems serving between 10,000 and 75,000
subscribers, and large systems as cable systems serving more than 75,000 subscribers.
4.
We determined that 750 observations of communities, divided between the two sampling
groups, were required for statistical precision. To determine the number to allocate to each group, we
used a standard sampling size formula calibrated to yield sample price means within one percent of the
50

See supra note 1, Section I.

The Commission assigns a unique community unit identifier (CUID) code to each registered cable operator for
each community the operator serves; i.e., even if two unaffiliated cable operators serve an overlapping area, the
Commission assigns two CUIDs. 47 CFR § 76.1801
52

See supra Section II, Part A for a description of the recent change in the effective competition process.

53
See e.g., W. G. Cochran, Sampling Techniques, 2nd ed. (1977) at 87-107; G. W. Snedecor and W. G. Cochran,
Statistical Methods at 434-59, 7th ed. (1980).

2018 Communications Marketplace Report

Video and Audio Appendices

actual price means at a 95 percent confidence level.54 After determining the overall sample size for each
group, we allocated the number of selections among the strata. Allocation methods generally emphasize
two criteria. First, selections allocated to a stratum are higher relative to other strata in proportion to the
population or other size measure; in our case, the number of cable subscribers. Second, more selections
are allocated the higher the dispersion of price. The sampling size formula we employed accounted for
these criteria. In addition, we adjusted each allocation by a non-response factor. 55 Attachment 1 reports
sample sizes for all strata.
5.
After allocating the number of sample selections using the process described above, we
drew independent samples of communities from the strata, 56 using probability proportional to size (PPS)
sampling without replacement. 57 A PPS design is efficient for our survey because there is a correlation
between the number of subscribers in the community and our key survey study variable, price. 58 Using
the PPS method of sampling, we assigned a selection probability to each community within individual
strata in direct proportion to its relative number of subscribers. The greater the number of subscribers in a
community, relative to others in the same stratum, the higher the likelihood of selection. PPS sampling
requires sampling selection probability not exceed one (or 100 percent). Thus, we took the standard
approach and sub-stratified communities whose probability exceeded one into one-unit strata with
selection probability equal to one. 59
6.
The PPS sample design requires an estimate of the relative number of subscribers in each
community. We estimated subscriber counts using 2016 county-level operator subscriber estimates and
population estimates. 60 This is the first survey to use updated subscriber counts. In previous surveys, we
used the FCC’s 1994 census of cable communities, the first and only such census. Using more recent
54

The formula was from B. J. Mandel, Statistics for Management (1984) at 258. See also, e.g., C. A. Boneau,
Effects of Violations of Assumptions Underlying the t-Test, Psychological Bulletin, 57 (1960) at 49-64.

55
Because previous surveys suggest not all selections will respond to the survey questionnaire for various reasons -e.g., the system no longer operates -- the non-response factor adjusts selections by the expected number of nonresponses. Our non-response factor equals [1+ [NRh / (NRh + Rh)]], where in stratum h, NR equals the number of
non-responses and R equals responses to our survey.
56
To prevent sampling bias, we draw the samples independently, including separate samples for incumbents and
rivals in locations with a second cable operator; i.e., selection of an incumbent did not require that the rival would be
selected and vice versa.
57

We generated the samples using the SurveySelect procedure, PPS Method without Replacement, SAS software,
Version SAS/STAT 9.4, SAS Institute Inc., Cary, NC (2016).

See, e.g., F. Yates and P. M. Grundy, Selection without Replacement from Within Strata with Probability
Proportional to Size, Journal of the Royal Statistical Society, 15 (1953) at 253-261; and B. K. Som, Practical
Sampling Techniques, 2nd ed. (1996).
59

We applied the following algorithm to sub-stratify each community (or unit) with selection probability greater
than one. For a sampling stratum, where Z represents the total number of subscribers, zi is the number of subscribers
in unit (i); n is the sample size, πi = n (zi /Z) is the selection probability of unit i; and k is the number of units for
which the sampling probability exceeds one. We sub-stratify each unit for which the sampling probability exceeds
one, which reduces the sample size in the stratum to n-k. This then requires recalculating sampling probability πi for
each of the remaining communities in the stratum. We repeat the process until there are no communities left in the
stratum with a sampling probability greater than one.
60

Estimates of operator subscribers at the county level come from S&P Global, MediaCensus, Operator Subscribers
by Geography (accessed November 15, 2016). The estimates refer to the second and third quarters of 2016.
Population estimates come from Annual Estimates of the Resident Population: April 1, 2010 to July 1, 2015, U.S.
Census Bureau, Population Division, May 2016 (accessed March 16, 2018).

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subscriber counts improves the quality of the Report because our sample and the resulting estimates better
reflect current cable subscribership.
B.

Data Quality Control

7.
To improve the quality of the survey data and reduce the burden on operators, the survey
questionnaire is web-based. 61 After the samples were drawn, we notified operators serving the selected
communities and instructed them to complete the survey questionnaire on the Commission’s website. We
took steps to ensure the reliability and accuracy of the data collected. Computer checks notified
respondents in real time of inconsistent responses. In addition, we asked a responsible party within each
company to certify the completeness and accuracy of the company’s responses. The survey response rate
(ratio of completed to requested questionnaires) was 99.5 percent or 746 of the 750 communities in the
sample. The four non-responses were cable operators that had either ceased operating in that community
or had yet to commence operation.
8.
We systematically examined all survey responses using algorithms designed to identify
potentially inaccurate responses. When a particular response was deemed unreasonable or was
inconsistent with responses to other questions, we contacted the operator and asked him to verify the
answer or make a correction. The percentage of survey responses that require follow-up inquiries varies
over time based on such factors as the familiarity of the respondents with the survey, the complexity of
the questions, and introduction of new questions to the survey instrument. For the 2017 survey, we
contacted approximately 10 percent of parent operators with follow-up inquiries via email or telephone
calls. Each operator replied with a correction or explanation of the particular response. In the case of
missing data, some operators provided these data and others explained that they did not collect that
particular information or were not serving the community at the time.
C.

Estimation of Means

9.
The report presents the average (mean) levels of the survey data by cable service level for
the full sample, sample groups, and subgroups of cable operators. The report tables summarize these
findings and the attachments to the report display detailed statistics. After we collected and checked the
responses, we estimated the population means and variances from the sample data. We estimated the
means and variances of cable prices and the other variables on a subscriber basis rather than a cable
community basis. We choose this level of analysis because we are interested in understanding the price
paid by the average subscriber rather than the price charged in the average community. The two methods
of analysis yield different results when there is a correlation between the size of a community (number of
subscribers) and the level of price. To produce per-subscriber means, we use the Horvitz-Thompson ratio
estimator. 62 This estimator weights the price in each of the sampled communities by its number of
subscribers. The numerator of the ratio sums the weighted product of price and subscriber count across
61

In our web-based questionnaire we include features that ease the respondent’s filing burden. For example, the
questionnaire pre-fills some survey questions based on information already on file with the Commission and asks
the respondent to verify the information.
62

The Horvitz-Thompson ratio estimator is a well-known, unbiased method of estimation applicable to probability
sampling. See D. G. Horvitz and D. J. Thompson, A Generalization of Sampling without Replacement from a Finite
Universe, Journal of the American Statistical Association, 47 (1952) at 663-685; W. S. Overton and S. V. Stehman,
The Horvitz-Thompson Theorem as a Unifying Perspective for Probability Sampling: With Examples from Natural
Resource Sampling, The American Statistician, 49(3) (1995); and Cochran (1977) at 259. We began using the
Horvitz-Thompson ratio estimator with the 2009 Report. Prior to the 2009 Report, we applied the unweighted mean
in each stratum.

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communities in the sample and is equivalent to total revenues from purchases of the cable service. The
denominator of the ratio sums weighted subscriber counts across communities in the sample. The result
is an estimate of service revenue per subscriber. For any price (X), the mean price (service revenue per
subscriber) equals
N

∑π
i =1

X i ⋅ Subi

∑π
1=1

,
Subi

where X i is the price within an individual community i, Sub i is the number of subscribers in community i,
and π i is the size weighted probability of community i. 63
D.

Historical Price Series

10.
Attachment 7 reports average prices and channel counts for all annual survey reports to
date. For example, the 2016 averages in Attachment 7 are from the 2016 survey, and the 2017 averages
are from the 2017 survey. Note that 2016 averages in the other attachments of this report are from the
2017 survey (each year we collect two years of data) and may not match the 2016 numbers shown in
Attachment 7 due to random variance between the 2016 and 2017 survey samples. With some
exceptions, averages in Attachment 7 come from each year’s survey report for the full sample. Indices
reflect the year to year percentage changes in these averages.
11.
The exceptions to the rule above are described here. The 1995-2000 prices and 20002001 channels are for the noncompetitive sample group of operators. The 1995 price of expanded basic
programming is the price of programming and equipment less an estimate of the equipment portion. In
2003, the survey changed from a July to a January collection date. To account for the change, the 2003
index values reflect the changes in the January 2002 to January 2003 averages reported in the 2003
survey. In 2010, we began collecting data on a more expansive set of channels. To account for this
change, the 2010 channel and price per channel index values reflect the changes in the 2009 to 2010
averages reported in the 2010 survey.
E.

Survey Accuracy

12.
Because the basis of our survey is a sample of communities rather than a 100 percent
census, the average prices in this Report are subject to sampling variance. Expanding the survey to
include all communities might increase accuracy, but would also increase the cost and burden of
collecting the information. The attachments to the Report include estimates of sampling variance or
statistical standard error for each average price. Standard errors express the degree of confidence that the
true mean falls within a range around a sample mean. Most commonly, standard errors indicate whether
price differences are statistically significant (meaning statistically different from zero) at a given
confidence level. The discussion above refers to within-sample variance. To prevent random variance
that may occur across samples when measuring annual percentage change, the survey collected two years
of data rather than comparing estimates from two different surveys. The exception is the historical time
series table, which reports means collected for that particular survey year.

We conducted the data analysis using Stata Software, StataCorp. 2015. Stata Statistical Software: Release 14.
College Station, TX: StataCorp LP.

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13.
In addition to the sampling variance discussed above, changes in the composition of
sample subgroups affect the estimated means. 64 The composition of communities making up the strata
changes every year due to operators starting, ceasing, merging, and transferring operations. Composition
of the strata changes further as a result of findings of effective competition. Many communities that had
been part of the noncompetitive group in the 2016 survey were in the effective competition group in the
2017 survey because of a change in the effective competition process.65 Finally, the change in underlying
sampling weights this year also led to a change in the sample composition.

See, e.g., D. Holt and C. J. Skinner, Components of Change in Repeated Surveys, International Statistical Review,
57 (1989) at 1-18.
65

See Section II, part A.

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