Smallest State to Get Uniform Pricing

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Cox Communications Inc. said last week that it would begin
phase one of its move toward uniform pricing and channel lineups within the state of Rhode
Island with its next rate increase there, set to take effect Sept. 15.

After a large wave of system swaps over the past few years,
Cox now controls more than 90 percent of the cable-television market in Rhode Island,
serving 270,000 customers.

Along with the new systems the MSO acquired, however, Cox
also inherited a range of different packaging and pricing structures, according to Cox New
England vice president of government and public affairs John Wolfe.

Cox has eight different franchise areas in the state, each
with its own rate structures and channel lineups. "Rhode Island was a little bit of a
patchwork quilt," corporate spokeswoman Amy Cohn said.

The operator had heard frustration from customers who lived
in one town but who wanted the programming offered in the next town over. "Rhode
Island is a small state," Wolfe said. "People talk across communities."

Most of Cox's Rhode Island plant has been upgraded to
750 megahertz, and the operator has made digital cable and high-speed service available to
about 90 percent of its customers in the state.

Wolfe said it may take another year or two before pricing
structures are completely uniform throughout Rhode Island. Even then, programming lineups
could vary slightly, as certain systems offer different local broadcast stations or
public-access channels.

The company has already begun to adjust its channel
lineups, dropping New England Cable News in the few Rhode Island communities where it had
been offered, for example, and switching Fox Sports New England from a pay service to part
of its standard-service package across all systems.

The move toward uniform programming packages will help Cox
to focus its marketing efforts across Rhode Island.

This helps to put the operator on equal footing when it
comes to competing with national direct-broadcast satellite companies like DirecTV Inc.
and EchoStar Communications Corp., which can advertise exactly the same packages whether
they're marketing in the northern or southern parts of the state, Wolfe said.

Rate increases for Cox customers in Rhode Island will
average 3.8 percent, although no systems will raise prices for their most basic packages.
The company has agreed to implement a new needs-based discount program for senior citizens
starting Oct. 1.

Wolfe said he is part of a committee seeking to update
cable regulations in Rhode Island, which have not been revamped since 1981.

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