By K.B. Sherman, Community Reporter
Shrewsbury – At the February 26 Shrewsbury Board of Selectmen meeting, the board unanimously approved a $2.80/month rate increase for SELCO subscribers who get both the BASIC cable service and the Expanded BASIC cable service. For those using just the BASIC service, their monthly rate will increase $1.17.
Speaking for SELCO, General Manager Michael Hale detailed the company's costs and opportunities. Touching briefly on the contentious issue of SELCO proposing to phase-out its senior discount, he pointed out that without this discount the average cable subscriber would be paying $2.45 less per month, as regular users currently subsidize seniors. Under the controversial proposal, senior discounts would no longer be offered to anyone turning 65 after April 1, 2013, and that existing senior discounts would be phased-out. Using a PowerPoint display, Hale related that even with the proposed $2.80/month rate increase, SELCO's transmission costs will rise $1.94 a month per subscriber, or, 2/3 of the proposed rate increase. He added that since 2003, SELCO's costs to provide cable service to Shrewsbury have increased 69 percent, with annual cost increases expected to continue.
Hale pointed to figures in his presentation illustrating that other factors in the rate increase are a flattening of increases in both Voice over Internet Provider (VoIP) service and internet subscriber income. He noted that the proposed $2.80 increase is only a part of SELCO's estimated cost increase of $4.50/month/customer to continue supplying service, as industry costs are now expected to increase 7 percent to 18 percent annually.
Regarding SELCO's electrical power sale, Hale said that while electrical power is accounted for separately from cable, internet, and VoIP, a reduction in electrical rates will help offset an increase in cable rates. And that while competitors Comcast, Time ?Warner, Charter, and Cablevision have all increased their rates since the beginning of the year, SELCO's proposed increase is far less.
Board members commented that SELCO officials had “done their homework” and that a rate increase was necessary. Board of Selectmen Chair Maurice DePalo asked if cable, internet, and VoIP were all transmitted over the same infrastructure. Hale said they were, ??with each using its own distinct transmission and switching devices. Hale also noted that over the years cable has become ever less profitable and has been supported in large part by VoIP and internet, and use of those are flattening-out. Selectman Moira Miller said that she understood that SELCO's rate increase plan was a way to save SELCO.
By a vote of 5-0, the rate increase plan was accepted by the board. However, the re-licensing contract is still under construction and was not voted upon at this meeting.
