LEWISTON – Cable rates are going up. Again.

Viewers in Lewiston-Auburn who want to watch Larry King, the Fab Five, SpongeBob or the Red Sox will face April bills surging past the $48 mark.

Adelphia Communications says it needs the $2.95 increase, the fourth in five years. It’s part of doing business in a competitive market. The price the company must pay for popular channels is rising almost as quickly as the demand for costly high-tech improvements.

However, that market, particularly for the customer, is changing.

In January, Oxford Networks began selling cable TV to a few households in Auburn and will soon spread to neighborhoods in Lewiston. Meanwhile, the country’s two largest satellite TV services, Dish Network and DirecTV, say they are close to providing central and western Maine with local channels, adding to lineups that already include CNN, MTV and ESPN.

“We absolutely recognize that it’s a competitive marketplace,” said Kathleen Hounsell, Adelphia’s government and public affairs director for Maine. “People will have to decide what is of value to them.”

No doubt, they will.

People have already begun leaving Adelphia.

Between January 2002 and January 2004, more than 1,500 people from Lewiston, Auburn, Sabattus and Lisbon left the cable company. Adelphia leaders believe many have contracted with either Dish Network or DirecTV.

About 25 percent of Maine homeowners subscribe to satellite services, according to a spokeswoman for EchoStar, the company that owns the Dish Network. About 70 percent of homes here subscribe to cable TV. The remaining 5 percent either have no TV or receive only broadcast signals.

Maine is one of satellite TV’s best customers, said Pat Scully, a Portland lawyer who specializes in communications.

Part of the reason for high satellite numbers is the rural nature of the state, he said. People who live outside town centers are often unable to get cable. Companies naturally don’t want to spread wires that can cost up to $30,000 per mile to only a few homes. So, the more densely populated the area, the more cutting-edge its system tends to be.

That’s especially true for the Portland area, which serves as Time Warner Cable’s flagship system. Portland acts as the test market for new innovations by Time Warner, the country’s second largest provider of cable TV. Nationwide, the company has more than 15 million subscribers. Comcast is the biggest, with more than 28 million. Adelphia, the fifth largest, has more than 5 million.

Scully believes that cable customers are leaving because the prices are getting too high. Many of the same channels offered on cable can be offered on satellite TV for much less.

Finding the right price

The Dish Network offers the least expensive package, supplying 60 channels for $24.99 per month. DirecTV’s cheapest package offers 115 channels for $33.99 per month.

For an additional $5 on each system, operators hope to add local channels, something the satellite industry has yearned for. Many people don’t want to subscribe to a TV system that leaves out the broadcast networks and their local news programs.

“That’s been the major stumbling block for us,” said EchoStar/Dish Network’s spokeswoman, Michelle Portillo. Give people their channels and they would leave cable much faster, she said.

They want to see the weather man they know and have grown accustomed to, said lawyer Scully.

“It’s impossible to overestimate how important that is to people,” he said.

The local channels are coming, promised Portillo, who estimated that service would be offered sometime in April. Dish Network is coming to terms with the local TV stations over the cost of retransmitting their signals in the satellite system.

DirecTV was more vague. Spokeswoman Jade Valine estimated that her system would have the channels “in the springtime.” It’s purely a technical issue, she said.

“You’ll get local channels as soon as our next satellite goes up,” Valine said.

Putting the wires to work

In Lewiston-Auburn, Adelphia cable is also facing competition on the ground.

Oxford Networks, a Buckfield company mostly known for its telephone service, began installing fiber-optic cables around the Twin Cities last fall. The company is building new headquarters on Lisbon Street in Lewiston and plans to wire the whole of both cities by 2008.

In January, they began putting those wires to work, offering cable TV, local and long distance phone services and high-speed Internet to about 500 homes and businesses.

“We’re taking it slow,” said Roderick Anstey, president and CEO of Oxford Networks. Already, the new wires pass an estimated 5,000 homes and business in the Twin Cities. But the company is selling the service neighborhood by neighborhood, so workers don’t fall behind in their installation work.

“We don’t want people waiting a long time,” Anstey said. Each TV connected to the system would need set-top boxes, like those needed for satellite or digital cable, and a box attached to the home. It’s called an NID, short for “network interface device.” The box manages the signals of the fiber optics, which go right into the home.

In its initial offering the system is selling well, said the CEO. However, the service is different from other cable providers. Services are bundled. The only stand-alone cable service is the 16-channel broadcast package at $32.95. It compares to Adelphia’s own broadcast cable package. Though not digital, Adelphia’s costs $15.95.

However, Oxford Networks is also offering a digital cable package with more than 100 channels. Buy one of the other services – local phone, long distance phone or high-speed Internet – and the price is $79.95 per month. Sign up for three and the cost is $109.95. For all four, it’s $129.95.

Educating the buyers

Perhaps some of the competitors cost less, but Adelphia’s leaders say the newcomers probably won’t be able to keep their prices so low.

Every TV service must pay the costs charged by CNN, ESPN and most every other channel on the growing dial. And those costs are climbing fast, said Mike Edgecomb, a government relations worker with Adelphia.

According to the National Cable and Telecommunications Association, the cable industry’s lobby, sports has been driving much of the increase. The rights to televise the NFL, the NBA, and Major League Baseball have all more than doubled in the last 10 years, according to the association. The exact costs are industry secrets, however.

Those increases have had a dramatic effect on rates, said Hounsell, Adelphia’s public affairs manager for Maine.

People should think of the TV packages they buy as entertainment, comparable to a special dinner at a restaurant or attending a play, said Hounsell.

If a subscriber watches four or five programs in a whole month, the premium might be worth it, she said.

People also need to know that rising costs have been accompanied by more channels, a clearer picture and millions of dollars spent on technology.

The same “classic cable” package that will carry a charge of $45.90 this April – more than $48 after fees and taxes – cost only $20.62 in 1996.

The number of channels has nearly doubled, Hounsell said. But the price climb is startling. While cities and towns have franchise agreements with cable operators, those operators decide the prices. Towns cannot enforce rate caps or ceilings.

“It is almost entirely unregulated,” said Scully, who has worked with towns across Maine in the formation of franchise agreements. Those agreements are what give companies such as Adelphia and Oxford Networks the right to act as utilities, offering their services to homes.

Lewiston-Auburn can do nothing to prevent Adelphia’s rate hike, Scully said.

“I don’t think they are acting like a company that is competing with anybody,” he said.

Hounsell disagrees.

“Customers will have to make the decisions,” she said.

dhartill@sunjournal.com

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