The Problem With Cable Is Television

Comcast and Time Warner, the country's two largest cable systems, are making more money than ever, with lower capital investment. But if there was one weak spot jumping out of the numbers, it was not their Internet business but their traditional TV service, where the cost of paying for content to put on all those channels is rising faster than subscription fees. Hansell observers:

1) Cable is a good business,

2) The fastest-growing expense is programming,

3) The operating cost of providing broadband service is low and getting lower,

4) The biggest savings is coming from lower set-top box costs,

5) The biggest future investment relates to expanding high-definition video,

6) Prices for video services are going up, but data prices aren't.