A-La Carte Cable More Expensive?
I got a comment on my blog from someone from CableTechTalk, which is a blog of sorts set up by the National Cable and Television Association (NCTA). Clearly, this is a lobbying firm for the cable MSOs in the United States.
The post they linked to my blog dissects the A-La Carte pricing and why it is ultimately bad for consumers. However, instead of going through that post, I will dissect their talking points on a-la carte programming and why mandating it is bad for consumers.
Prices Will Go Up Because Of The Need For Set Top Boxes
They mention lots of points here, but what it boils down to is that in order to implement a-la carte pricing, you need a set-top box. Many people–myself included–don’t have a cable TV set-top box. They estimate it will drive up the cost of basic cable by $11.41, which in my case would nearly double the cost of cable.
Don’t you need a set-top box for anything beyond basic cable anyway? If I want the right to choose other channels, fine, let me bear that cost, either by leasing the cable box or buying it outright. Leasing set top boxes, cable modems, etc, is a scam in my point of view.
Reduced Diversity Of Programs
They say that less popular channels are bundled with more popular channels, in a sense creating a subsidy effect. Advertising on many of these cable networks are sold based on the number of potential viewers, not necessarily the number of people actually viewing the channel. If everything goes a-la carte, then the ad revenue of these networks goes way down, causing some channels to fold.
How is this a bad thing, seriously? I get overwhelmed when I go to anyone’s house but my own. There are too many channels to keep track of, what’s on where, when, etc.
It Will Change The Way People Enjoy Television
And this is a bad thing how, exactly? Oh yes, I can’t “channel surf” and “discover new programs” in the way you would have me do it.
Guess what, Tivo and it’s bretheren did the same thing. Instead of being held hostage by TV schedules and figuring out how to program a VCR, you just tell Tivo what you want to watch, it records it. It also records stuff you might be interested in, based on your previous viewing habits.
As far as discovering new shows? I have friends that I socialize with. We occasionally talk about what we saw on the Internet or on TV. I’d much rather find programs that way than surf 500 channels to find what I want to watch. Takes much less time and, generally, is far more enjoyable.
Studies Other People Did Agree With NCTA’s Views
They list things like the FCC report, a report by Bear Stearns, General Accounting Office, Kagan Research, Sanford Bernstein and others say the same thing: it hurts programming choice and raises prices.
I think forcing everyone to a-la carte is not what the FCC has in mind here. What they want to do is mandate that cable companies offer a-la carte, not require everyone to have it.
If people want to buy 500 channels of crap, let them do it. However, don’t make that the only way people can buy television. Not everyone wants to do it that way.
Of course, what I suspect would happen is that the cable companies would intentionally make the prices ridiculously high so that very few people would go a-la carte and they’d maintain their existing business model. Seems like a self-fulfilling prophecy waiting to happen.
Regardless of the FCC getting involved, more and more consumers are finding alternate ways to watch video entertainment. The Internet has many, many great programs that quite simply aren’t on conventional TV. And guess what? The conventional television networks are enabling it. The cable companies only serve as bit delivers in this scenario.
The TV networks like it when you view programs over the Internet. Why? Because not only can they essentially force you to watch the commercial, they have a much better idea that you actually did watch it, too. Can cable companies say that about the ads they air on the various cable TV networks? Will companies pay more to know their ads has been seen?
It’s a little too soon to see how this will play out, though my money is on the cable companies becoming little more than bit shufflers unless they get much smarter about how they package and sell TV content.
