said by moldypickle:I find it absolutely HILARIOUS that SL would absorb some of the 8.5% increase each year on just tv. I've never heard of a business making a move that would cost them profit...
Actually, you'd be surprised at how many companies try to absorb the costs. The food industry has been very public about this recently. Fast food companies (McDs, BK, Wendy's) have absorbed fairly large percentage increases. Canned food companies (Conagra and more) also has come out publicly recently.
Ultimately, business will past the cost on to consumers when it becomes unprofitable.
Raising prices/rates is a risky proposition, there is only so much profit to be made before people bail for greener pastures. If you raise them and start losing customers, your revenue goes down, then you must lower them EVEN more to gain the customers back.
Ultimately, SL has to compete with Dish Network and DirecTV, and for the most part do compete price wise. Dish just promised to raise their rates, and DirecTV is always a little more expensive, so what does SL have to lose?