It would be surprising if you answered, “No.” Except for cable company executives, we all feel that our ever-increasing cable or satellite TV bills are too high. However, even the executives understand how customers feel about these rising rates. The content producers, like Disney or Fox, are probably the major force at work causing this inflation. Cablevision tried to hold the line, in two high profile, publicly-reported fights with content producers HGTV/Food Network and ABC/Disney/ESPN.
Before cable and satellite TV
Once upon a time, we paid nothing for TV content. If you grew up before cable and satellite TV, when television shows were only broadcast over-the-air (OTA), you understand. TV stations and networks made their money from selling advertising. OTA still exists in most places but the selection of OTA shows is a small fraction of what cable or satellite TV vendors offer. If you live in outlying parts of major metropolitan areas you may not even get OTA.
No OTA here
Here in Southwestern Connecticut we do not get OTA TV. We are too far to receive the signals from New York City or Hartford, CT and too close to these cities to justify our own TV stations. If you live here and want to watch TV you need to subscribe to cable or satellite. The subscription television alternatives in this part of Connecticut are Cablevision, Comcast or Cox cable (depending upon where you live), DirecTV, Dish TV and AT&T U-verse. Verizon FiOS is available for a small part of Greenwich, CT.
Prices for TV services are similar for these vendors. Competition is the primary reason. Cable companies, AT&T and Verizon offer triple-play package deals, bundling television, phone and Internet services. The pricing for these packages is superior to buying the services à la carte. They also offer packages of TV channels rather than selling them à la carte.
An à la carte menu?
Many people, including me, would like to buy our TV channels one-by-one rather than having the limited menu of choices. I want premium channels like Cinemax, Showtime, TMC and HBO. I don’t want sports, foreign language or kids channels. Unfortunately, that is not an option. If my family wants to watch TBS, TCM, the History and SyFy channels, we have to pay for Disney, HGTV, ESPN, FOX Sports and many other channels we do not watch. We never watch them but we have to pay for them. It is a tax, only not a government imposed one. We pay to keep sports channel costs low enough so that our sports-loving neighbors can watch beach volleyball along with the myriad professional sports shows. I wish it were otherwise. It is not.
How much does the cable company pay?
Recently a list of 2009 wholesale TV prices was published on the web. It was eye-popping. Did you know that sports channels comprise most of what we pay for each month? In 2009, ESPN charged cable companies $4.08 per month per subscriber, $48.96 a year. FOX Sports charged $2.37 per month. C‑SPAN was a bargain at $0.05.

I used this list to calculate what Cablevision is paying for non-premium cable channels. The SNL Kagan information was incomplete. Cablevision offers non-premium channels that are not on the list. The total monthly cost for the channels I could identify was $23.95 per subscriber.
Separate from deals for new subscribers or triple-play customers, Cablevision charges $55.95 per month for Family Cable, which includes broadcast basic. About half of that subscription price goes to pay ESPN/ABC/Disney, Viacom, FOX, NBC/Universal, and the other content companies. Cable companies also have to maintain substantial plant and equipment, provide customer service at our houses and over the phone, pay employees, pay taxes and make a profit.
Perhaps a better question is, “Why do we pay so much for TV sports channels like ESPN?”