"An official determination of the end customer price for the cable connection of UPC Cablecom is therefore not appropriate at this time," writes the price supervisor in a newsletter published on Tuesday. Virtually all Cablecom customers have access to alternative offers from one or more TV providers. Swisscom TV alone is used by over 1.2 million households today. Thanks to the access regulation of the Swisscom network, third-party providers such as Sunrise could also offer fully-fledged TV, Internet and fixed-line telephone services.
Competition for TV customers
The conditions on the TV market have changed significantly in recent years, the price supervisor explained. In particular, the digitization of television has meant that high-quality TV services can be distributed virtually everywhere, including via the telecommunications network. As a result, customers are increasingly demanding all services - TV, Internet and fixed-network telephony - from a single provider. And the expansion of the fiber-optic network will create another alternative to cable networks at the infrastructure level. While Swisscom was able to gain 147'000 new customers within a year and increase the number of TV customers to 1.238 million as of the end of June, the cable network operators lost ground. Overall, cable operators still had 2.579 million TV users at the end of June. That is 3.7 percent less than a year ago. The cable network operators primarily blame Swisscom's better sports offering for the bloodletting. Cablecom still has the most TV customers, with 1.353 million at the end of June. However, 17'300 TV customers jumped ship in the second quarter. The cable network Quickline had 368'000 TV customers. Meanwhile, Sunrise increased its customer base in the TV business by 33'100 year-on-year to a total of 122'300 subscribers. This is 37 percent more than in the previous year.
Next price increase coming
Cablecom has already announced the next price increase, as the previous agreement with the price supervisor expires at the end of 2015. Next year, customers will have to pay CHF 33.95 per month for their cable connection. That is a good 13 percent more for the basic TV, Internet and fixed network telephony service. Cablecom justifies the sharp price increase with investments of around 200 million francs annually in its own cable network and in new products such as higher Internet speeds. The price increase of 4 francs per month as of January 1, 2016, includes 2.15 francs for service and repairs. Cablecom had previously billed these expenses separately, it said. Until now, customers have had to pay 29.95 francs per month. The price supervisor and Cablecom had agreed on this amount in summer 2014.
Different reactions
Naturally, Cablecom was pleased with the fact that the price supervisor is giving up monitoring the basic rates for the cable connection. "We take note of this with goodwill," Cablecom spokesman Bernard Strapp said when asked. The competition in the TV market is strong, which confirms the analysis of the price supervisor. Competitor Swisscom also understands the withdrawal of the price supervisor: "We see that the market is in full play. Competition in the television market is very high. We can understand the price supervisor's decision.
understand," said spokesman Olaf Schulze. Sunrise also sees that competition is at play. "However, we insist on transparency in end-customer prices, which are often hidden in Cablecom's rentals and are also only mentioned in small print in advertising," said Sunrise spokesman Roger Schaller. Therefore, Sunrise had requested a warning from Cablecom at the State Secretariat for Economic Affairs (Seco). Seco had pointed out that the Zurich cantonal police was responsible for this. The procedure is still ongoing, Schaller said.
More power demanded for Comcom
The Stiftung für Konsumentenschutz (SKS) is less pleased: The decision of the price supervisor is understandable, because the market situation today is different than it was five years ago, said SKS managing director Sara Stalder. But there would then no longer be a regulatory authority that could intervene in the market. Today, there is an oligopoly: TV providers can watch each other and align their prices. The Federal Communications Commission (Comcom) could only intervene if a competitor was not satisfied with the situation and filed a complaint. Stalder fears rising prices: "There is a movement toward the top, disguised by bundled offers." The SKS is therefore calling for an expansion of Comcom's powers, he said. The telecom regulator must be able to look at prices in advance, he said. (SDA)