AT&T's Price Hikes Could Be 'Good News' for Cable Competitors: CCG
AT&T's move to raise broadband rates $5 a month for a second consecutive year "is an interesting choice," CCG Consulting's Doug Dawson wrote Tuesday. It's likely a sign that "the company is meeting its fiber penetration goals and doesn’t think a rate increase will hurt its market share."
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"This has to be good news for the big cable companies that compete against AT&T fiber," because AT&T's prices are no longer "noticeably lower," Dawson said. "If the cable companies decide not to raise rates now, they can advertise against AT&T for doing so. However, this could also give cable companies the cover to raise rates again, and I’m sure this announcement is being discussed in cable Board rooms."
During AT&T's quarterly earnings call last week, CEO John Stankey said the company doesn't "just raise prices to raise prices. We raised prices when we think we've given the customer greater value, and we try to time it to that." The new rates take effect Dec. 1.