Slashdot Mirror
Suit Seeks 'A La Carte' TV Channel Choices
An anonymous reader writes "A breathtaking lawsuit was filed this week against every major player in the 'for-pay' television industry. Every major broadband and cable company in the US was named in the federal suit, which seeks the right to obtain content piecemeal rather than in the large (and expensive) packages that cable companies offer as the only option right now. This follows closely on the heels of encouraging comments from the FCC chair that he supports this kind of service. 'The complex web of contractual arrangements among service providers and networks amounts to a monopoly or cartel that has "deprived consumers of choice, caused them to pay inflated prices for cable television and forced them to pay for cable channels they do not want and do not watch," [antitrust lawyer Maxwell M. Blecher] wrote in the complaint filed on behalf of cable subscribers in several states. The complaint, which alleges a conspiracy to monopolize as well as violations of federal antitrust laws, names nine plaintiffs, but Blecher wants the U.S. District Court to certify it as a class action.'"
Networks like Discovery DEMAND that the lesser channels of theirs also be carried and forced upon the viewers and subscribers. Lots of Content networks do this to ensure their lesser and crap channels get viewership.
They need to start there making it illegal for networks to demand that if you want to carry or subscribe to XYZ channel you do not have to get DEF and the crappy ZBZ channel as well.
Do not look at laser with remaining good eye.
But even so, it's hard to see how anyone could possibly find it justified at this point in time. If it weren't for the DMCA, we could get it by show off of YouTube...Clearly there is no technical limitation.
It comes down to the fact that their business model is more and more dated by technology. No one is obligated to provide them a free ride.
ad logicam Claiming a proposition is false because it was presented as the conclusion of a fallacious argument.
My inner geek is gonna miss programming my remote. My Harmony and I have had a long love affair skipping useless channels like HVC, Fox News, and Disney. I'm gonna miss her.
This is awesome. I have a 'digital plus' cable package with over 200 channels, which I had to buy because the 4-5 channels I regularly watch were on that list. I would love to get rid of the other 190 channels or so, (200-(5 I watch)-(5 or so others I occasionally use/check)) and if I could get a price cut at the same time, that'd be even better.
If this happens the providers will respond by separating popular shows on to their own channels. The top rated content will be padded with junk you don't want to watch. The only answer is to sell shows individually.
I only ride 20% of the rides at the local theme park, should I get an 80% discount?
Of course I'm rooting for this one -
In my area, I can get basic cable ($50), the local high-def channels ($0), and a DVR ($9). Sounds pretty good, right?
Oh wait, if I want the "Navigator" functionality (the ability to use the digital cable's menus and program recordings), I have to pay $3 AND purchase a $30 "Digital Tier" pack of complete crap channels.
If I built a new MythTV box (no local phone line, so no TiVo... has that changed lately?), it would take several years to recoup my costs. Monetarily, I don't think it would be worth it; however, it's tempting to take a hit just to make sure the money I do spend doesn't end up in Time Warner's pocket.
Should this be the option for everything?
I want an a la carte TV channel as well. I only want to pay for the shows I watch. I also want an a la carte newspaper. I don't care about the sport section so stop charging me for it. The thing is though that a cable company can offer channels for less by packaging them. I might not really be too keen to pay as much as someone with kids for a kid's channel, but there's occasionally something good so I'm willing to pay a small extra in addition to other channels.
The family with kids may not really want one of the other channels but see it as worthwhile if it's in addition to the kid's channel, but there might occasionally be something kid oriented so they'll pay a little extra.
We would love to offer a la carte programming, but there are two huge obstacles.
1) Many times, we are charged per cable subscriber for a network even if we don't offer it the subscriber. ESPN is this way, as well as some of the sports channels. You'll pay for it as a customer even if you don't want it, because we get charged for it. That charge is comming to you one way or another, either through a package price or a base price as a cost of business. If you don't want ESPN, we're still paying for you to have it.
2) Many networks like Discovery and Fine Living give us massive price breaks if we show their second and third tier channels to a certain percent of subscribers. If we ran an a la carte service, this would be a nightmare. It means that if in a given month, if 30% of our subscribers didn't want Fine Living, but wanted Food TV, your price would triple. Do you really want to have a monthly bill that fluctuates that badly from month-to-month based on the whim of a TV network?
This isn't meant to FUD you. God knows, we'd like to be able to offer you a la carte, we have the technology to do it. And honestly, even though cable and sat companies piss customers off, we don't really want to. You are our customers. But to the networks, YOU ARE NOT THE CUSTOMER, YOU ARE THE PRODUCT. The advertisers are the customers, and they are selling your eyeballs. Until that situation changes, and the networks have less power over us in contact negotiations, you probably won't see a la carte. For all the malfeasance you can lay at the feet of cable companies, this is surprisingly not included.
you can go to a park with per ride admissions, or to a park with all day admissions.
and you have a choice.
I am juste olde enough to remember pinning myself at Disneyland CA with the cute pins and my ticket to indicate having an all day pass-- as opposed to paying per ride... but-- I don't have to go to disneyland... I can go to the local carnival....
furthermore, amusement parks don't have governmental granted monopolies over a certain geographical area.
Businesses with Gov granted exclusive privleges by god do need clamping down/regulations.. or they will certainly run rampant... and this goal has no real hurdles, other than the desires for a fat bottom line on the part of the corps.
nothing else... and if the 'people' grant them the exclusive privlege of serving the 'people' then the 'people' should be able to place limits on what they get..
every day http://en.wikipedia.org/wiki/Special:Random
My local cable company did just this in the mid 1980s or so. I don't remember the exact numbers, but it was something like $20 for all 30 channels. Or, you could pay $10/month for the first tier of channels, plus $2/ea to add more channels. If you wanted anything more than a small handful of a la carte channels, it was vastly more expensive to purchase them outside of the bundle. We may think we want a la carte, but the devil is in the details. As long as cable companies are monopolies, you can bet on any such "changes" remaining a better deal for the cable companies than anyone else.
ESPN is one of the most expensive, if not the most expensive channel on your cable system. It costs them a ton of money to carry it, and the costs are passed on to you whether you watch it or not. I'd be more than happy to be given a chance to get rid of it forever.
It's always aggravated me that I have to pay for ESPN, reputedly one of the most expensive channels on cable, because ESPN has the market power to force their inclusion in the basic tier. To receive the Science Channel and the National Geographic Channel, I have to pay for a tier that includes all sorts of crap that I don't watch.
Mea navis aericumbens anguillis abundat
If this lawsuit results in a change in policy, it will mean nothing for most people. Selling channels on a per-channel basis is more complicated for the cable providers, and will thus be more expensive per-channel. Unless you literally watch only one cable channel, you will probably pay more to pick-and-choose 2-4 channels than you would pay for an entire package, including 90% channels you don't care about.
I used to work for Cox Communications, and in my area, "limited" cable is $11/month (channels 2-22, aka fancy rabbit ears). "Expanded" is an additional ~$30 (23-72). And the digital tiers are something like $2/month (for 5 to 20 channels per tier each). (HBO, Starz, Cinemax, etc, are priced entirely differently).
The digital channels (which are most popular to complain about--probably because there's the perception that there are "hundreds" of them due to their channel numbers reaching into the 300's and 400's in some cases) are by far the cheapest channels there are, and it doesn't make sense to break up a package that cheap.
Where it might have an impact for some people, is breaking up the "Expanded" tier (most cable companies have something similar), as the bulk of that $30/month price is the subscription fee the cable network pays to ESPN (something like $24/mo, if I recall).
If my memory is accurate, and the ESPN fee is $20+/month, then that means the other channels (23-72 minus ESPN) are $10/mo or less. And then it's suddenly very "reasonable" again.
Of course... if cable channels are sold a la carte, then the price per channel will go up by necessity. The *average* cable bill will still be roughly the same as it is now (assuming the programming also stays the same--and of course it wouldn't). The difference would be that families with 8 members who actually use 2 dozen channels would pay a higher cable bill, and single-member households (like mine) will only subscribe to 2 channels, and pay less.
I guess what it all comes down to me is: It's a lot of fuss about something that isn't a big deal, and it's just as likely (if not more likely) to hurt the consumer as it is to help them, except in fringe cases.
See, that's why ala carte is stupid, while those channels might be popular with slashdot, they are massively unpopular with the public at large. What this means is that they will be expensive. Right now the reason there are some geek friendly channels on cable is because they are subsidized by the popular stuff. If ala carte pricing ever happens, the only affordable channels will be the popular ones, and all the niche channels will cease to exist, or be prohibitively expensive.
Look people, ala carte might sound good, until you realize that in order to remain revenue neutral the people who watch the popular channels will pay less, and those who watch the more obscure stuff will pay more. And who are we kidding the cable companies aren't going to roll out a new pricing scheme that is revenue neutral, so in reality only those who choose the only the most popular networks will pay the same (and get less), and anyone who wants anything out of the ordinary (read: slashdot) will pay more.
The apartment I just moved into REQUIRES all residents to have basic cable. (You can't have just Cable Internet, and because you don't have cable on your own account (it's built into the rent), you can't get a "package discount" by having Internet + Cable. Oh right, they also charge about $10/mo more for basic cable than the cable company directly would sell you, even without any discounts.
/they/ want. (after all, you can always just choose not the have cable, you whiny handout-wanting bastards). This "cable is required" thing was sprung on me after I'd given notice at my previous apartment.
Has anyone ever heard of this? This sounds like more of an abuse than a cable company setting prices however
-- 'The' Lord and Master Bitman On High, Master Of All
But, how else am I going to enjoy my guilty pleasure of E! without the cover of subscribing to the "extended lineup"?
It's the cable equivalent of walking up to the rental counter with Super Slut Cum Fest #9 sandwiched between Howard the Duck and Sleepless in Seattle.
More Twoson than Cupertino
But we can't do that. They wouldn't let us show Fine Living but NOT Food Network. We could potentially do a la carte for packages, but we kinda do that already. The only improvement would be to break the bigger packages along networks. But you'll still see lots of crap channels bundled with the likes of Viacom.
Remember, our relationship with networks isn't friendly. Comcast got sued, and we're under current litigation over the remote DVR "Start Over" service. It's copyright infringement to start the show over if you switch the channel, because we're the ones recording it, not you. Heck, we get threats all the time during negotiations over offering the DVR service. Networks are convinced that home recording is illegal and think we may be liable because we aren't forcing you to watch your show in 3 days without skipping commercials or delete it. They think shifting the commercial time as much as 30 minutes ruins the value of the commercial.
Sure, we may be incompetent from no weak competition. But we don't get get our jollies by screwing customers. Remember, if a network can keep your eyeballs, they'll run roughshod over you. Viacom knows there's no substitute for MTV, but God knows if we piss off enough customers, sat TV would destroy us.
In fact, it's slightly perplexing how channels get away with charging cable companies to carry them; they make money through advertising, and the more viewers they have, the more money they can make this way, yet they also charge cable companies to increase their potential viewership.
I am TheRaven on Soylent News
digital cable boxes can do alacarte Tv channels right now.
Not true. Cable companies offer packages of channels. They carefully separate their "money maker" channels (sports, movies, documentaries) into different packages. If you want the local stations, they're on the basic package. If you also want the sports channels, you have to buy the bronze package. If you also want, say, the Discovery channel... no you can't just add one channel. You have to upgrade to the silver package. No, you can't trade off the golf channel and the knitting channel to get the Discovery channel. If you want the Turner Classic Movies channel, you need to get the gold package.
Actually, it's even worse than that. The cable companies will put stuff like the Discovery channel and the History channel into separate packages. They've got it set up so that if you want all the "hot" sports channels, or all the "hot" entertainment channels, or all the "hot" documentary channels, you have to get the premium package.
There was a company here in Toronto called Look. They used to offer a la carte channel selection about four or five years ago. They abandoned it "for technical reasons", and have gone to the combo platter style of channel lineup. (Look also used a microwave broadcast system rather than cable. You had to be within line of sight of one of their repeater antennae.)
When our name is on the back of your car, we're behind you all the way!
While this sounds like a good idea, it would ultimately mean the death of a lot of good programming and channels. Yes, you may only watch 10 channels, but are those the most popular 10 channels? If they aren't, they may not make enough money to survive in an ala carte setup. Something like G4 (which yes, is nowhere near as good as it was but still has some good shows like X-Play) probably would never make it if it was subscriber only, as it is a niche channel. There just wouldn't be enough people willing to pay $3 a month (or however much) to get the channel. Same thing with VH1Classic, Discovery Science, and many other niche channels that have some good programming. Ala carte means every channel must cater to the lowest common denominator, as they survive on getting as many people to order their channel as possible. That means lots of things like MTV and less things like SciFi.
Ala carte sounds great for my pocketbook, but I'm not willing to give up the good, niche programming that would die off to save a couple extra bucks a month.
"Information wants to be expensive" - Stewart Brand, the same guy who said "Information wants to be free"
I swear I heard horses twice when I read the blurb. Something about that lawyer's name... Hmmm.
_14k4-
To be completely honest, that was not my intent in any way. I completely understand the points that the OP is trying to make. The problem comes in where cable co's have complete monopolies in many areas (take my area- very wooded, tall trees so few can get satellite, only one option for cable TV. What does it cost? $75.00 for the basic analog channels the last time I checked). This particular cable company has actively prevented other cable cos from coming in, and those who want cable, pay the price (the price I pay is not having cable.. I wish more around here would do the same, but they go along with it).
Then the OP makes the point that proper and innovative laws are what will protect the consumer. Well, when was the last time you saw a proper or innovative law that would regulate a large corporation come into play? As I see it, the problem is 3-fold: in many areas cable companies have monopolies, and thus typical economics don't come into play. Second, as with any big industry, lobbying has gotten out of control, and the government has gotten to the point that it is acting as an agent of industry. Finally, many industries (including the cable companies) cling to old business models, that many consumers are starting to realize, aren't very consumer friendly. Due to problem 1, when it comes to cable co's there in some areas, there is no competition to cause change.
And I truly do apologize for the hubris and adolescence in my replies. I guess being in an area (which may be unique) with a cable situation that is very anti-consumer, and has been in place for years, caused me to go off the deep end a bit, and for that I am sorry.
I produce television programming for cable. If you don't think advertisers are savvy enough to know the difference between the number of homes a network is available in and the number of people actually watching a particular program, you're an idiot. The FIRST thing they ask is 'How Many Viewers?'
paintball
The problem is, a lot of people are dumb. They can't look at more than one step of a problem.
Dumb person:
I am paying $100/month for 200 channels, but I only watch 5. If I could pay ala-carte, I could get the 5 channels I want for only $2.50!
Smart Person:
If I and everyone else only pay for 5 channels instead of 200 channels, each channel gets 97.5% less revenue, and either raise their rates by 4000% to compensate, or they go out of business. (Even that isn't quite right as it ignores the components of costs for the cable company per subscriber vs. per-channel costs paid to the content providers.)
Whether content is bundles or ala-carte, you're going to pay an average of $100 a month, or lose channels. Popular channels will charge more because people will pay for them, and unpopular channels will charge more because they need to to stay in business on a smaller subscriber base or they'll cease to exist.
Remember, if you stop paying for all the other channels you don't want, the other people who don't like YOUR channels stop paying for your channels to. Nobody comes out ahead.
paintball
Amen. I pay roughly $80/month for my cable TV for more than 80 channels, so that's less than a dollar per channel per month. That's a great deal when you consider a lot of people pay about that for their mobile phone plans. If I bought only the channels I wanted under an a la carte scheme (and I've watched maybe half of those 80 channels at some point over the past year), I'm sure I would be paying more than $80 per month, probably a lot more. That would be at least a doubling of the price I pay. The current scheme keeps prices down.
Also, I don't want to lock myself out of channels I may find interesting in the future. I like being able to channel-surf a wide variety of programs. I don't like subsidizing the religious channels, but I'd bet that Congress would allow them an exemption or force the cable providers to carry their shows for free as a public service, like they did with broadcast TV. (However, I have also heard that religious broadcasters have been wary of the a la carte scheme because they are afraid of getting shut out by the viewers, and this was even when the Congress was rabidly conservative, so perhaps they don't have the allies there to force that through after all.)
The folks who push the a la carte scheme would be better off pushing the content providers to make the individual shows available either for free from their websites (like NBC) or for a fee through services like iTunes. If people will pay two dollars to watch a half-hour sitcom (or a 3-minute music video), then there's clearly a lot of money to be made with a truly a la carte scheme (by the show and not just by the channel) outside of the cable channels. That route is clearly much more lucrative for the content providers to pursue.
Better yet, if the consumers are unhappy with the cable TV pricing structure, they just shouldn't buy cable. The market should react to what the consumers want. I don't like having a contract forced upon me by my mobile phone provider, but I buy the service because it's worth more to me to pay the money and have a mobile phone than not having the phone service at all.
Interestingly, channels like HBO and Cinemax (Time-Warner companies) are cheap compared to ad network channels like ESPN (around $6 a head). Our basic access, which is dirt cheap at under $10 a month, you get the local channels, and the shop-at-home channels. It's pretty much free to send it to you, because the shop-at-home channels pay us per subscriber, subsidizing the line.
But places like NFL network and ESPN charge us for them, even though we don't send them the signal for their channel. NFL costs $10-$20 a head and, as I said, ESPN about $6. So, since most people around here want ESPN, and if enough people want NFL network, you'll likely have to pay, in one way or another, for those channels.
God knows I wish it wasn't the case. I wish sat TV offered decent competition, and I'm sure they think the same about us. But we're fundamentally a cartel of 2-3 providers for a given area selling overpiced goods from monopoly suppliers. And since there's no niche provider for geeky TV, customer demand and monopoly pressure would mean that we'd probably just serve ESPN, NFL, shop-at-home, and populist reality shows, and not negotiate the rest of the channels, whatever is most profitable to serve to most people.
And hey, it is our problem to work out pricing with the networks. But what the the lawsuit should be over is why there is no competition in the cable and content distribution markets, and why Verizon and Sprint are so slow in rolling out their TV options. You've been paying for non-existent fiber for a decade or more, why can't you reap the benefits of their cabling and content negotiating power?
First, we'll drop smaller networks that try and play rough. We can afford to.
But what happens when Fox wants a better deal? They run commercials saying how the local cable company is trying to take your channels away. Most of our customers think they have a God-given right to TV and we're just getting in our way. It can be surprising what people will do without before going without TV. The pecking order is something along the lines of Rent, power, TV, food, phone, etc on down the line. We'll take lots of blame for dropping Fox Sports, but a $3 increase will be tolerated by the customer.
There is a nugget of truth to this, as I explained above. They will only fight as hard as they need to keep us the most profitable. And while this is intentional, it's merely economics. Why SHOULD our negotiators and buyers negotiate bad deals? We have no motivation from competitive or customer pressure to change the deal. You can blame us, you can blame Fox, Universal, or Viacom, or you can blame the market, it won't matter except to make lawyers richer and the plaintiffs feel smug. Blame won't change the fundamental economics of the matter, and that's what needs to change if you want to see a la carte pricing. A lawsuit won't fix the underlying issues
And, in fact, it may even improve the situation for smaller channels. Because people elect to get these channels, and specifically pay for the privilege of doing so, they have overtly expressed an interest in that channel's content. A little research and ta-da — demographically-targeted commercials, for which they can charge higher ad rates.
"I guess the moral of the story is, don't paint your airship with rocket fuel." -- Addison Bain
There is this little thing that some people like to refer to as "diversity". In some ways, it means catering to minorities and in others is means broader cultural vision.
Today, there is a cable/satellite channel dedicated to running old movies. How many people actually watch that enough to justify paying for such a channel? Damn few. How about a cable channel dedicated to television shows with Black actors? Today, there are more than one of these and considering both the number of people interested in such channels and their disposable income, it is doubtful that such channels would survive.
Sure, there would be plenty of people supporting the mainstream pablum that is on USA and FX. Movies with every questionable word silenced or redubbed. SciFi channel might survive, but it has a rather narrow appeal.
Unfortunately, the money required to operate an enterprise as a cable/satellite channel is pretty high. Today, if your offering gets picked up by cable systems you can operate and if not, every goes home to find something else to do. It isn't cheap to do this and it isn't going to be cheap in the future. This means that anything marginal or not clearly focused on the mainstream entertainment experience is going to go by the wayside.
I would miss the SciFi channel. I would miss TVLand and AMC (old movies). But my purchasing these channels on an ala carte basis would not be anywhere near enough to keep them operating.
Ala Carte is a method by which the larger media organizations get to push their message at everyone even more consistently than they can today. Anyone without a dedicated majority of the viewers loses. This has already happened with radio - there are few formats today and they all have mass appeal. Anything for smaller audiences is gone. Ala Carte cable will have exactly the same effect.
This is going to come off, possibly, as a little elitist, but I am a bit worried about this and I think I have good reason to be. I don't watch Dancing with the Stars, or Deal or No Deal or Survivor, or anything like those shows. My concern is that the channels I do watch - channels like Discovery, FLIX, Sundance, IFC, Encore, etc - the kinds of movies that don't show *the latest blockbusters* - almost none of which I want to see - will not make enough revenue to survive. I'm not some kind of artiste who only likes stuff no one else does, but I also cannot handle insipid, and if there is one thing the United States has proven in recent years, it's that it loves to get its Stupid on. Big time.
Maybe this is fair and I can understand people making a free market argument here. But as much as I enjoy the prospect of not giving my money to the bottom-of-the-barrel networks like, say, E!, I am afraid that in the long run this may reduce the amount of quality channels available to me.
I'm not at a point yet where I have the energy to hunt down everything I want to see on the internet and put myself at risk by downloading stuff.
All I'm saying is, be careful what you wish for - you might not like what you get. As much as I can enthusiastically envision my cable box de-crufted of idiocy like the Golf channel (you have got to be kidding me, and this is not a slag on the sport itself), I also see a lot of the stuff I like dying away because the amount of subscribers cannot sustain it.
A better model for TV watching might be direct-to-DVD series that you could rent or buy from a Netflix-like operation. Even on the channels I like, I actually watch a very small percentage of the programming they make available. I don't object to the idea of foregoing cable altogether and instead getting DVDs of shows like Mythbusters or Survivorman, as well as the novel independent and foreign films I have come to rely on for sanity. Ditto bigger shows like Lost (maybe the most high-profile show I've ever liked) and The 4400. This might also provide the opportunity to be able to watch a show with all sorts of random crap popping up on the screen, which drives me batshit insane.
Also, completely offtopic, I'd love to see some kind of NIGHT FLIGHT themed channel which shows random weird crap all day. Wouldn't you? I know I'm not the only one who is sometimes too tired and bored to do anything but watch TV. Wouldn't it be great to have a channel that showed random animation clips, obscure music videos, 50s school scare films, acid-drenched biker films from the 60s, and so on, specifically for people who, like me, can easily flip through 200 channels and find not one thing I want to watch? And it should be a channel with an absurdly lax standards and practices department. Lots of titties, guns, Satanism, and kaleidoscopic psychedelic interludes. John Lydon's mug all up in the camera at least once a day. Boyd Rice racing Ivan Stang on a unicycle. Documentaries on anarchists, neofascists, Moonies, Scientologists, and Extropian VR gurus with no hair. Retro commercials, at random. I am talking Preparation H commercials from 1967. Ads proclaiming the lung-cleansing, expectorant effects of Lucky Strikes. Commodore and Atari 8 bit computer commercials from the 1980s. Drug hysteria films from the 1930s that aren't Reefer Madness. And also Reefer Madness. Nick Zedd films shown without comment or context between Terrytoons shorts. Random outbursts of Sonic Youth. Maybe show the Death Valley '69 video every night at 3:00 AM as some kind of tradition. Dog Police. Racist cartoons. Anti-Nazi WW2 propaganda cartoons. Random weird crap from Japanese television. Movies like Fantastic Planet. Documentaries on Raymond Scott, Laurie Spiegel, Esquivel, Can, Magma...insert your artist or band here. Propaganda films. Obscure blaxploitation flicks. Satanic panic documentaries and films which exploited the phenomenon (there are few things more satisfying to me at 3 AM than a movie like The Devil's Rain).