The Tribune

By NATARIO McKENZIE

Tribune Business Reporter

nmckenzie@tribunemedia.net

AN outspoken community activist yesterday questioned whether Cable Bahamas’ proposed fee increase for its basic cable TV offering was intended to subsidise its $65 million acquisition of two Florida-based communications providers.

Former DNA candidate, Rodney Moncur, told Tribune Business that Cable Bahamas’ deal to acquire the two Florida-based communications providers proved the company “had the means” and did not need an increase in its rates.

Cable Bahamas Limited has unveiled a proposed $65 million deal to acquire south-Florida based Marco Island and its mainland affiliate, NuVu, plus Orlando-headquartered Summit Broadband. While Bahamian and US regulatory approvals are pending, the deal would give the company access to more than 18 million people.

While no direct link has been drawn between the two issues, many Bahamian consumers - irate over Cable Bahamas’ application for a SuperBasic rate increase equivalent to $8 per month - are likely to believe the rise is being sought to finance the Florida acquisitions.

“It would appear that the true reason behind these proposed increases are now emerging,” Mr Moncur told Tribune Business.

“Cable Bahamas has had a monopoly from inception. They have made a tremendous profit after paying all of their expenses. We know that they are making a tremendous profit just on basic cable rates. We now see, with their attempt to acquire this gold mine in Florida, that they have the means and obviously they are charging us to help subsidise this purchase.”

Cable Bahamas has previously stated that it needs the basic cable TV rate increase to bring it into regulatory requirements for a minimum 10.86 per cent capital return. This, the company has said, means it has no choice but to seek an increase.

Cable Bahamas is seeking a 27 per cent increase in the monthly charge for SuperBasic (RevTvPrime) cable, which represents an increase of $8 per month for residential consumers and $13 for commercial customers.

The current monthly rates of $30 and $50, respectively, have not changed since Cable Bahamas introduced the service in 1995. The BISX-listed communications operator applied for a price increase to its SuperBasic cable television service, currently marketed as its RevTv prime cable television package, last December.

The Utilities Regulation and Competition Authority (URCA) has held a series of town meetings on the proposed fee increase, which has been met with widespread disapproval from the Bahamian public.

Mr Moncur, who has also been outspoken on the issue, reiterated his opposition to the proposed increase. “They are making millions. I don’t think they should get the increase. I don’t think they should get a cent,” said Mr Moncur.