Comcast spokeswoman Jennifer Khoury said the $29.95 price for its "digital economy" TV package simplified the cable company's pricing structure and allowed basic-cable subscribers to more easily upgrade. The digital-economy package does not include the popular ESPN channels, the most expensive in the cable-channel lineup.
The pricing moves at the nation's two largest cable companies come amid a troubling period for the cable industry, which lost 741,000 basic-video customers in the third quarter, the largest quarterly decline on record, according to research firm SNL Kagan.
Some industry experts blame over-the-top Internet providers such as Hulu or streaming services such as Netflix. But Comcast officials have pointed to economic factors and issues related to the over-the-air digital-TV conversion in 2009.
Neil Smit, the new president of Comcast's cable operations, said in a conference call with analysts that it appeared people were switching to over-the-air TV broadcasts, not the Internet, when they cut the cable cord.
The nation's TV broadcasters modernized over-the-air signals in 2009 with digital transmissions to sharpen TV picture quality and boost the number of over-the-air channels through multicasting.
Richard Schneider, the president of a seven-year-old company in St. Louis that manufactures over-the-air digital-TV antennas, said November and December were the two biggest months for sales at the privately held Antennas Direct Inc. The antennas cost between $50 and $150 and are sold through Costco, Best Buy, and other retailers.
Customers who canceled their pay-TV service were switching to traditional over-the-air TV and then supplementing those local channels with entertainment content on the Internet, Schneider said.
