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Congress To Force Cable a la Carte Plans
unassimilatible writes "Senate Commerce Committee Chairman John McCain seems to be leaning towards sponsoring legislation mandating something I have wanted for a long time: Forcing cable companies to offer "a la carte" programming packages. No U.S. cable or satellite currently offers such a plan. However, as the Washington Post reports, "That may change, if some lawmakers and consumer groups get their way, as the cable industry finds itself under increasing scrutiny. Lawmakers report that their constituents are angry about cable bills that have risen at three times the rate of inflation since the industry was largely deregulated in 1996." McCain money quote: "I go down to buy a loaf of bread. I don't have to buy broccoli and milk to go with it." Bottom line is, cable companies have a government-authorized monopoly, so maybe they need to recieve government-mandated "innovation." Why should I pay for 15 non-English channels?"
While I am completely against government regulation of things like cable, the Cable Companies have made their own bed on this one. They scammed themselves a legal monopoly, now they have to dance to the government's tune. Of course, they'll just pass the 'costs' of this on to the consumer. But they can't claim some kind of moral high ground against 'government interference', when they've been sucking off the government tit for the last 20 years.
I want to delete my account but Slashdot doesn't allow it.
I've been wanting this for so long. I hate paying for things I don't need.
"Besides adding to the cost, cable companies say, selling channels individually might make it difficult for lesser-watched, niche channels to survive."
This is bad how?
"...angry about cable bills that have risen at three times the rate of inflation..."
Don't forget that quality has also dropped noticeably. We're paying more for more channels, not more good programs.
G
So when did a-la-carte mean cheaper? Go to a mexican restaurant and order a 3 enchilada meal, and order 1 crispy taco on side. Unless you are going to Taco Bell... that damn crispy taco is going to cost you just about as much as 1.5 enchilada!
The cable company is going lobby against this big time. If someone just wants TechTV only at their office, it's going to cost them big time. The cable company would at least like to make some profit off of everyone of their subscribers.
Thats my $0.02... oh yeah forget... since I'm only making one comment today, I'm charging more... that'll be $3.50.
Sig (appended to the end of comments you post, 120 chars)... oops
However, less-watched channels that serve distinct but smaller audiences, such as TechTV and BET, may not survive, because not enough viewers would pay for them.
Which is fine. TechTV and BET are both complete garbage. What better way to improve the quality of programming than to mandate it through public dollar votes?
(Just give me Sci-Fi, Cartoon Network, Comedy Central, and the Playbo--er, Discovery, and I'll be good to go. Heck, maybe NBC as well, if for no other reason than this year's feisty presidential election.)
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It's ridiculous for me to have to spend over $50/month for cable just to watch Comedy Central. I'd much rather pay just $5 a month for Comedy Central instead of the $30 extra or whatever I have to pay to get the "package" that includes it. Comcast sucks.
But cable companies don't work in free markets, they are given a monopoly over their customers.
I'm not saying I support the government meddling in the affairs of businesses (for they are not subtle and quick to raise prices), HOWEVER...
They would have to raise their prices quite a bit for most people's bills to go up and not down. Considering I watch about 10 channels of the hundreds I receive.
Ironically, the word ironically is often used incorrectly.
I assume McCain's legislation will also include provisions rendering the contract provisions from content providers that require bundling of their offerings null and void. Otherwise, the point is somewhat moot. It's not just the cable/satellite service providers that are the problem.
What has been will be again, what has been done will be done again; there is nothing new under the sun.-Ecclesiastes 1:9
-- Note: These Comments are Generated by ME! Not You! ME!
If companies sell shit you don't want -- don't buy it.
Yes, this means you have to give up the something you want, because it's bundled with a bunch of shit you don't want. Hang in there -- if enough consumers stop consuming the shit, companies will desperately try to save themselves from bankruptcy by selling you what you really wanted in the first place.
-kgj
-kgj
Bottom line is, cable companies have a government-authorized monopoly
monopoly = monopoly is a situation where for technical or social reasons there cannot be more than one efficient provider of a good
Unlike Microsoft, there is no alternative to the 2 or 3 services, one of them being the Cable Monopoly, because they ALL bundle their channels.
I have to buy 100 extra channels just to watch TechTV and Cartoon Network, and then spend an hour Removing all the shopping and religious channels, as well as Fox News and A&E.
Yeah! Let the market decide! If you don't like the price don't by it and force the price down, just like gasoline and electricity and natural gas....
Oh wait....
Dude, sometimes the market can't or won't decide. Then the government, who are supposed to have the interest of the electorate not the cable company executives and shareholders, will decide.
Sometimes governement interference is bad, sometimes its not.
Never by hatred has hatred been appeased, only by kindness - the Buddha
If there was only one supermarket, then they probably would demand you buy everything in chunks of standard sizes. The thing is, we have competition, so since the customers don't want it, they could go somewhere else that does offer what they want.
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Cable companies don't have such competition. There's typically a choice between the local cable provider and a couple of satellite providers. They can get away with this sort of thing by a sort of unspoken agreement. If one of them offered a la carte, so would the others.
Essentially this is the prisoner's dilemma. They both know that they will both get the best results by cooperating
It's not the cable/satellite providers. It's the channels themselves. If I'm running Jim's Cable TV and I want to offer my customers TNT, for example, Turner might make me buy TBS, The Cartoon Network and the CNN channels as one package. That means I have to charge my customer for all those. So I might as well give him the channels he is paying for.
I know this because I worked for a satellite TV provider. It was like pulling teeth to be able to offer ESPN to our customers. Finally one of our managers had to call Eisner personally to straighten things out. As much as I'd like to make the cable companies out to be the bad guys, it's really the networks.
Jim
A dyslexic man walks into a bra.
umm...the congress is in place for the good of the american people, but you say this, "Have we no bigger problems in the world..." What do the problems in the world have to do directly with america? Sure, we love to stick our nose in the doggy poo-poo, but we also have our own problems.
cable companies have a monopoly just like the phone companies used to. What happens when the cable companies start tacking on service fees for maintenance of their own network? They get regulated just like the phone companies did. If I buy cable, why do I also have to pay for 100 channels that I didn't want?
Why read the article when I can just make up a snap judgement?
It's not always the cable companies that force bundling. Take a look at Disney. They force cable companies to buy their channels in blocks so that while a cable company may only want ESPN and the Disney Channel, they also have to pick up Toon Disney and other channels as well. This additional cost gets pushed onto the consumers.
Didn't Viacom and EchoStar have a fight over this issue just a few weeks ago?
"I go down to buy a loaf of bread. I don't have to buy broccoli and milk to go with it." Bottom line is, cable companies have a government-authorized monopoly, so maybe they need to recieve government-mandated "innovation." Why should I pay for 15 non-English channels?"
As a Canadian, we're used to this sort of socialism (NB: Socialism != Fascism != Communism). Many french and other non-english channels cannot survive in the market without being subsidized. Take our music industry for example. If you want to run a radio station here, you must play a certain percentage of Canadian artists so that US artists do not swamp out our industryt altogether.
All in all, I think forcing people to pay for a small percentage is a good thing, but then again what do I know? I'm just a brain-washed Canadian.
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This is hardly leftist. Pissing off companies that hold a monopoly goes all the way back to Teddy Roosevelt, arguably the most liked republican behind President Lincoln and President Reagan. McCain is more of a centrist, but he's obviously republican...
Now, if the story had said that McCain wanted this and a pony... You might have something to your theory of the leftist bent... But of course, no silly obvious bias would be allowed to be put in story here... No.. Of course not!
The ILECs have stuck all kinds of charges and fees on our phone bills to cover the 'costs' of government compliance.
Low-end stations that are being subsidized right now already ARE losers. Economic darwinism is circling over them, ready to strike the minute that the government wind blows the other way. Their mandate for existence is tenuous at best.
Non mainstream programming will have to revert to unrestricted media, like radio or over-the-air TV, or the Internet. In the Warsaw ghetto it was underground newspapers. It will always survive. The problem is that you can't both claim a right to protection, and then demand a blank check on what you produce.
I want to delete my account but Slashdot doesn't allow it.
TV will not be forced to innovate or die just because some people who probably don't watch tv much anyway cancel their tv subscriptions. Face it, not many people who actually watch are going to want to do that.
We can however force them to change and innovate by telling them what we want! Look at it this way... You think MTV has become a pile of trash, but you like what's on [random channel]? You tell your cable company you don't want it. Enough people do that and MTV realizes they have to innovate, yet you still get to watch your shows on [random channel]. Actually, not only do you get to watch them, but the owners of that network realize they have a good thing going and are less apt to change their shows.
As things are now, the networks don't give a care about what you think. They can pretty much put up whatever they want and still get paid. The ratings systems in place now don't cut it... What's wrong with giving the consumer more control over what's on?
"Lawmakers report that their constituents are angry about cable bills that have risen at three times the rate of inflation..."
I get so sick of hearing complaints about the cost of X rising than more than the rate of inflation. Guess what, the inflation rate is an overall value, some things will grow at a higher rate, some lower. Given the fact that the value provided by cable has grown*, I really think people don't have much to complain about here. Think also of how much time people really spend watching cable - it is basically the main form of entertainment in most homes.
This is like the constant whining over the price of gas. If you actually consider the value that consumers get out of it, the price itself isn't so bad.
* While it is fashionable to constantly bemoan the lack of good content on TV, look at the diversity of offerings that cable provides, and the opportunity for shows to reach major success from small beginnings that never would have occured on network TV (like Trading Spaces or Queer Eye).
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Here's what I see happening.
Cable rates will go up even more.
Cable companies will charge even more for the individual channels in order to recoup the costs of administering the additional choices. Popular channels will go sky high such as CNN, ESPN, HGTV, etc. The channels nobody want's (QVC, HSC) will be free anyway. I wouldn't doubt if channels like QVC actually pay cable companies to carry them. Without those "support" dollars, they will pass on the full true cost (and then some) of those good channels.
If you look at the technical issues, the only way to really do this is with digital TV. Considering the $5 or so / TV cost of the stupid box (plus even more for a remote in many places) that raises prices for households with a bunch of TV's. With old-analog, you could tivo multiple different channels at the same time while watching a third or fourth all on different channels. With digital, I'd need a box for each tivo plus one for each TV. It's easy to pay an additional $25 / month for stupid boxes.
Thanks but no thanks.
Think of it. Content providers charge based on total subscribers. This is why your satellite providers can offer cheaper service. they operate on a wholesale business model.
Cable companies are stuck with an exponentially smaller subscriber base, so prices will be higher than dish.
Now, if you begin to divy up on a per channel basis, where you had 300k of subscribers to charge equally for the Discovery channel, you now have to charge more for Discovery channel for the subs that want it. So ostensibly, you could be paying a ton more for your service.
plus, on the feasibility end of things, you would force 1 of 2 methods of channel blocking; either putting traps on the line outside, and attenuating the total signal getting into the house, or setting up an addressable cable converter for each set in the house, and scrambling all the cable channels on the service.
So, it sounds good, until you actually look into what you would have to do to get it. I wonder if the government would subsidize cable companies to convert to this new system. Oh, but if you get into gov't subsidies, then you're beholden to the government to transmit their party line.
from land that's owned by the taxpayers then I'll stop calling for my representatives to represent my interest when it comes to said equipment.
For that matter, nothing's stopping the cable companies from providing a la carte selection at some outrageous price and package-deals at the prices they've been charging all along, on the grounds that if people want a service, they'll have to pay for it at a price the market will bear.
The lament that "oh, we'll be paying $45/month for 6 channels" makes sense only if a-la-carte-only is mandated.
Dance like nobody's watching. Sing like you're in the shower. Fuck like you're being filmed.
Uhmm.. No. Just that there should be no restriction to someone else opeining up a car service shop.
Thanks for answering your own question. Makes life easier for me.
I think it would be cool if you paid for cable usage like you do for electricity...for how much you use. Give me access to every channel, and charge me by the minute. If I really like a certain show, I'll be willing to pay for it. If I go on vacation for a couple weeks, I pay nothing.
It might also cut down on the mindless hours people spend in front of their TVs.
I don't know if I would want to pay for C-SPAN, If watch it once a week, that's a lot. And probably more than most. Yet. I really like the idea that it's there shining a light on what goes on in congress. And I'm willing to pay for it as a part of my cable bill, If there's not enough like me, then it'll go away. That would be bad.
Also the cable companies need to make it easy and CHEAP to switch channels. Now you have to call them up, and it's a minimum of $5 for any changes. They should give me a package that I can choose 15 channels, and let me pick which, and change them at will.
I would be reasonable to have then force you to make only one or two changes a month. Otherwise you could effectively rig the system to let you watch all of it. Especially if there was a web interface to the selections.
We already know how willing they are to lie and fabricate numbers to get the legislation they want. In Tennessee, they've fabricated ridiculous statistics they claim are "losses from theft of service" in order to push through the MPAA's SDMCA bill. It's in the legislative committees right now and Tennessee Digital Freedom is working hard to stop them.
There's an e-mail campaign going on right now at Tennessee Digital Freedom to try to let legislators know that the SDMCA is wrong for Tennessee and that monopolies like the cable companies do not need additional protection from government. If anything, CONSUMERS need protection from the monopolists (and their lobbyists).
I encourage everyone to visit the TNDF website, check out the e-mail campaign and let politicians know what you think!!!
Yes, but its not a true free market. Cable companies have physical advantages of use of a land-line system that they other systems are not physically capable of competing with. Its like saying that, if there was only one car company, that they did not have a monopoly because you can still buy a motorcycle or take the bus.
Lets say there was only MS (sick sad world) on PC. DOn't like it? Oh, just get a Palm. Or a tablet. Or something else that's not a PC. Wait, you want a PC, but not MS?
This reminds me of the old saying: "Democracy is four wolves and a sheep deciding what to have for dinner."
With our current system, less popular channels are subsidized. That makes it possible for channels like TechTV, The Biography Channel, and Discovery Wings to survive.
With a la carte cable plans, we run the risk of sinking to a least-common-denominator selection of cable programming, where the consumer is given viewing choices of pro wresting, Fear Factor, Who Wants to Marry a Millionaire?, and soap operas. Small, special-interest channels may go under due to a lack of people willing to pay for them individually. Sure, mom & dad my get the kids to watch a National Geographic Channel show once every month or two, but will they be willing to pay for the channel every month? I bet that most of them won't.
On the other hand, I don't like paying for non-English channels, either, nor do I have any great interest in women's channels like Oxygen. I don't really want the Home Shopping Club or QVC. But I recognize that people who do want those channels may not like paying for The Discovery Channel, The Science Channel, or Speed Channel, either, all of which I do watch.
I'd rather see us go back to the old system where cable rates were regulated. This would prevent content providers from raising the rates too high, because they would know that the cable companies could not pass the costs on to consumers. Now they raise rates and the cable companies pass the costs on to us.
I think it's interesting that rates have gone up astronomically SINCE deregulation. Why is it that companies go before Congress and say "If we didn't have all this government oversight and regulations to deal with, we would be able to make more money and charge the consumers less." Well, guess what? The airlines, the savings & loan crisis, the energy companies all started either going bankrupt or ripping everyone off. Then, of course, they go back before Congress and say "It's not our fault, you didn't regulate us!"
That is always a given.
Popular channels will go sky high such as CNN, ESPN, HGTV, etc. The channels nobody want's (QVC, HSC) will be free anyway.
I think you have this wrong. Since the costs of producing and distributing programming are largely fixed, the huge sponsorship of popular channels will allow those costs to be spread over a larger group. Even at a lower per unit cost total profits will be high. Less popular channels will have a harder time reaching wide enough distribution to be proffitable. Therefore they will require a higher per unit cost.
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The whole cable box thing is how they get their rates to go up.
I remember back when the cable companies could charge based on how many TVs you had hooked up in the house.
But then that got dropped (lawsuits?). So now, you pay the same rate for service to the house, and you can run it to any number of TV sets that the signal will support.
With cable boxes, they bring back a way to charge you per TV again. That is by choice. With digital TV and standards, the basic channels don't need to be scrambled and you wouldn't need separate boxes for each TV. The only ones that would need a box are the ones that get premium channels. But even technology could take care of this.
There are ways to deliver ala carte, that would not require a separate box per TV with a per box fee, but that is not what the cable/sat providers would want.
After the recent Viacom/Dish dust-up, we were reminded of the bundling forced on cable operators by content providers -- want ESPN? Then you need ESPN2, ESPN classic, ESPN gardening, ESPN chess, the Menstruation Network, and the Colonoscopy Channel *or* you don't get ESPN. Oh, and because we're providing so many channels, the cost is high, too.
Cable operators have said that forced bundling by the content providers forces them to bundle channels as well, since they could easily sell ESPN ala cart but the 27 shit channels they have to pay for as well to get ESPN wouldn't sell, making it a huge money loser.
I'm generally in favor of unbundled channels, but only if they're vertically unbundled and the cable company only pays the content providers based on the subscriptions they have for those channels. Anything else should be considered a restraint of trade.
nonestly i don't think people will end up paying less for cable, what i reckon is likely to happen is that the good channels will be billed at something silly like $5 a month, now that doesn't sound too bad, but figure a base charge for connection say $20-$25 maybe they offer a free channel for the top tier, maybe you add Fox, MTV2, and your favourite sports channel, now already you're at $35-40 a month, your cable bill is $10 cheaper but you have a whopping 4 channels, there's also the point that networks that run multiple channels, like ESPN and MTV and C-span would likely spread the programming so that you need to buy both MTV and MTV2 to get what you really want.
I'll repeat myself: I should have added: When you cancel your account, be sure to write -- or better yet, write and call -- to let the company know why you are dropping their service: make clear what they must do to win back your business.
Better to do without, than to settle for second-best.
-kgj
-kgj
Cable does not have a monopoly on content delivery. Cable has about 70 million subscribers, compared to 20 million for the two major satellite providers. Nearly all consumers, even apartment dwellers, have a choice between cable and satellite television.
If you look at how the market has changed in the last five years, cable rates have gone up, but quality and quantity of channels have also improved. Cable improved their product to meet competition from the satellite guys, which traditionally have offered better quality and more channels - appearantly what most consumers want.
The satellite guys experimented with a la carte a few years ago, but it didn't sell. People wanted the 150 channel package. "Super size it. I want the best value."
The government should stay out of this particular fight. Market forces are working. The thing regulators need to watch is the mega-mergers between the content providers (News Corp, Time Warner, Disney, etc). It's these guys who have the power now. The cable and satellite guys are nearing a commodity status for delivery.
Their are millions of people living in apartments that find it extremly difficult to acquire satelite.
Jack Valenti and Orrin Hatch will be first up against the wall when the revolution comes.
So yeah, that'd be great.
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I used to want a choice in cable channels. I'm not a big sports fan, so I'd rather not have ESPN, nor QVC, etc. But after I thought about it for a while, it would probably be more expensive to have it ala carte, since the cable networks set the prices for their channels.
Think about it for a second. We have, what, 108 million cable subscribers in the US? Round that to 100 million for simplicity. If each cable channel (ESPN, CNN, Discovery, etc.) gets $0.25 per subscriber, they get $25 million to cover the costs of production. But if all of a sudden, we have all but 1 million of those people no longer paying, the channel only gets $250,000. So if it actually takes $25 million to produce the shows, then they're going to have raise their costs to $25.00 to make up the difference. Do you want to spend $25.00 a month to pay for SciFi?
Whether or not it costs $25 million to run the channel is open for debate.
Other grocery stores came and went. The town just wasn't able to support more than one, so in each case, the family-owned store survived because they were more concerned with staying in business than maintaining high profit margins. If they had raised their prices enough to piss people off, another chain could easily walk in and topple them, and periodically did.
Cable companies, by contrast, are a monopoly. There is a tremendous cost to starting a new cable company. First, you have to get permission to run lines. For areas with underground utilities, this often proves impossible, which kills that plan before it starts. Next, you have to pay the (often huge) cost of leasing pole space. And of course, you have to spend months running the lines across the city at a tremendous cost.
Compounding this problem is the contract that many municipalities have with their cable company, which provides for a government-sanctioned monopoly. The city may actually have to go through a termination process to remove the existing company before another would be allowed to provide service (assuming a traditional wire-based distribution).
Competing technologies like satellite have proven to be ineffectual because of the (perceived) high barrier to entry by the individual consumer (purchasing the system, installing it, etc.) Even the periodic "free dish with free installation" offerings do little to help because the cable companies abuse their monopoly power by showing advertisements disguised as public service announcements that pound lies and half-truths about satellite services into the heads of prospective consumers.
The only way cable service will ever be priced reasonably is if either there are always two or more cable companies per market or the prices are regulated by law. It's sad that it takes an election year to get our government to even give it a second look. If only every year were an election year.... *sigh*
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