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Consolidated Communications to stop offering cable TV by end of year

An office for Consolidated Communications in Yelm, Washington. (Photo by Matthew Keys for The Desk)
An office for Consolidated Communications in Yelm, Washington. (Photo by Matthew Keys for The Desk)

Consolidated Communications will exit the cable television market by the end of the year as it focuses on building out and maintaining its land-based broadband service business.

This week, customers in some areas began receiving notifications of Consolidated’s intention to stop offering traditional cable TV service, which will affect fewer than 30,000 subscribers, or less than 10 percent of its overall customer accounts.

“Consolidated’s strategy is based on a fiber-first product offering, which provides consumers and businesses a future-proof technology with unlimited bandwidth potential. As we make this transition, it will mean sunsetting some legacy products, such as linear TV services,” a spokesperson for Consolidated Communications said in a statement.

Consolidated has started notifying customers and municipalities in the areas where it provides cable TV service with information about its forthcoming plans and guidance on how customers can sign up for other pay television platforms, including streaming alternatives. Consolidated says it will continue to provide Internet and phone service in areas where it is withdrawing its cable TV product. The company provides telecom services in 23 states.

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Some of the major communities where Consolidated intends to end cable TV service include:

  • Bangor, Maine
  • Burlington, Vermont
  • Colchester, Vermont
  • Fargo, North Dakota
  • Garden City, Missouri
  • Kansas City
  • Katy, Texas
  • Kearny, Missouri
  • Lansborough, Massachusetts
  • Marion County, Illinois
  • Minneapolis, Minnesota
  • Nassau, New York
  • Portland, Maine
  • Rainier, Washington
  • Sacramento, California
  • Sioux Falls, South Dakota
  • St. Paul, Minnesota
  • Superior, Wisconsin
  • West Des Moines, Iowa
  • Williamstown, Massachusetts
  • Yelm, Washington

The move to withdraw from the cable TV market has drawn concern from some government officials in communities where Consolidated provides its service. By law, cities are entitled to collect franchise fees from telecoms who use public rights-of-way to deliver cable television service to the public.

In Jefferson Township, Pennsylvania, local officials say they stand to lose between $6,800 and $7,200 in franchise fees once Consolidated exits the cable television business there, according to a local newspaper.

Consolidate is one of the larger companies to announce their intention to move away from traditional cable television service in recent months. The company joins several other small- and rural-sized operators to end cable TV service amid ongoing rate increases imposed by programmers.

Those higher rates are typically passed on to customers in their bills, with the average price of traditional cable service eclipsing $100 per month.

In Jefferson Township, another cable provider called Armstrong recently sent letters to customers informing them of a rate increase due to higher programming costs. The average cost of service there will be between $124 and $133 per month, according to letters cited by the Berkshire Eagle.

Equipment and maintenance costs are also a concern, with one Alaskan cable company saying it would drop traditional pay TV service in order to save around $500,000 on cable box upgrades.

In an interview with this reporter for the website StreamTV Insider, an industry expert predicted more companies would continue the trend.

“There will be hundreds of companies shutting down [their pay] TV within the next 36 month,” MyBundle CEO Jason Cohen said. “The Tier 2 and Tier 3 video landscape will look markedly different three years from now than it does right now — and, that’s, I think, me being a little conservative — I think it will probably happen faster than that.”

Streaming products like YouTube TV, Sling TV and Fubo are increasingly stepping in to fill a void created by the loss of cable TV service in parts of the country. In some cases, broadband providers like Verizon Fios and Charter’s Spectrum are promoting streaming cable-like products to provide their broadband customers with more video choices and to help offset the loss of certain channels during programming-related disputes.

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About the Author:

Matthew Keys

Matthew Keys is a nationally-recognized, award-winning journalist who has covered the business of media, technology, radio and television for more than 10 years. He is the publisher of The Desk and contributes to Know Techie, Digital Content Next and StreamTV Insider. He previously worked for Thomson Reuters, the Walt Disney Company, McNaughton Newspapers and Tribune Broadcasting.
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