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Cable companies spend a lot of money figuring out what the most popular channels are then they make sure to put those in their premium package so that if you want to see them you have to pay extra to get them.
BTW people should do what I did and ditch cable TV and buy a Roku box.
Who decides how much each channel costs? The most popular channels will of course cost more so folks may end up paying more than they are now. That is probably how it will shake out as whenever the government gets involved they screw things up worse. Then they will blame each other for it and campaign claiming they are the only ones who can fix it even though they screwed it up in the first place. lol
The free market will provide just as it does with ever other product sold in the U.S.
I am amazed by how many people don't understand competition in the marketplace.
"The most popular channels will of course cost more so folks may end up paying more than they are now.'
By your reasoning Coke and Pepsi should cost $10 for a 16 oz. bottle since they are the most popular.
These are what most people want therefore they can charge whatever they want.
"Sen. John McCain (R-Ariz.) is working on legislation that would pressure cable and satellite providers to allow their customers to pick and choose the channels they pay for, his office confirmed on Wednesday. Consumers have long complained about the rising costs of cable TV packages and having to pay for dozens or even hundreds of channels just to gain access to the few that they watch."
I was undecided whether to post this here because of the legislation aspect or in the television forum where they don't usually address anything except specific show content.
What about you? Would you support something like this where you only pay for the cable channels you watch? I would like to get rid of ABC, NBC and CBS because I don't watch anything on those broadcast channels but it sounds like you would only get to pick and choose cable channels and still be stuck with broadcast channels you don't watch. I'm sure some cable channels would go out of business. Besides the cable industry, I bet Hollywood would be up in arms because it's bound to mean less avenues for work.
I'd support it, sick of all those crap channels I NEVER watch.
I find it funny people say I don't want ESPN but let's remember something for a second.
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Seeking Alpha: Disney Earnings Preview: ESPN Performance And Ratings Impact In FocusClose to 60% of Disney's value can be attributed to its cable networks business. This business is primarily dominated by ESPN, followed by Disney Channel and others. Accounting for the first quarter of fiscal 2013, we estimate that ESPN will bring close to $11 billion in revenues for Disney in 2012. These include revenues from the primary ESPN channel as well as its other sister channels such as ESPN2, ESPNU, ESPNEWS, ESPN Classic and ESPN Deportes. A large chunk of these revenues, more than $10 billion, will come from ESPN and ESPN2 alone. If we delve deeper, we find that close to $9 billion will come from just ESPN. The channel has close to 100 million subscribers in the U.S., which speaks of the huge demand as well as bundling strategies that pay-TV service providers adopt.
While ESPN continues to benefit from an increase in subscriber fees, it has been facing some ratings pressure. Disney's advertising revenues have remained more or less flat in 2012, as higher ad pricing was mitigated by ratings decline. The decline in ESPN's ratings can be attributed to Summer Olympics, which was broadcasted on NBC and garnered high viewership. This was a one-off success for NBC, and therefore, we now expect some rebound in ESPN's ratings in Q1 fiscal 2013.
While YOU may think ESPN is a waste because it's too much money, you don't watch sports, ect. there are others like me, who do and guess what, with 9 BILLION USD coming into Disney through the flagship ESPN alone, this shows what power Disney has.
Whoever said it was the cable companies that raise rates is wrong. It is in fact the television companies like a Disney or Viacom who will do this. Viacom is notoriously evil when it comes to negotiations when contracts are up and they wish to increase prices Forbes article on last year's fight with Direct TV.. Viacom ran several commericals running on their channels trying to get viewers to call Direct TV or switch to another providers. Some even made kids think Sponge Bob was dying.
Would like to see this happen, but doubt it will. I'm sure some will vote against it citing job loss concerns (if it comes up for a vote). Can't stand the fact ESPN charges so much for their stations. Even though I enjoy watching football I'd still give up ESPN due to the high cost. Even if they decide to lower the price I doubt it would be low enough for me to pick it up.
I have ATT U-verse 300 and pay $79/month plus taxes and fees. I've called and complained several times to negotiate a lower price when the old discount has run out. I'm getting $10/month off the tv bill, plus free HD through October. I'm also getting $5 off internet and $5 off phone in ATT's U-verse bundle package. You really have to negotiate with them which gets old (every 6 months normally). Eventually I'll switch to U-200 but certain channels will be missed. If it wasn't for the fact I have another cable operator in my area I probably wouldn't be able to receive the discounts.
Since I prefer current tv programs, news programs and live sports things like Roku and Netflix wouldn't suit me. I recently checked those out and they aren't for me.
The possibility is out there that free tv through an antenna could disappear as well. That would tick a lot of people off, including me.
Does anyone really think their cable/satellite bill would go down if this is passed? I have no doubt the average consumer's a-la-cart selections would end up costing more-or-less what they pay now for their chosen tiered package.
I just wish the SOBs would stop the silly practice of "introductory offer" discounts for 6-24 months which force you to switch back and forth every so often to avoid getting gouged in the out-years. The first available provider to offer a reasonable fixed-rate plan (somewhere between the intro pricing and long-term-customer pricing) will have my business consistently.
The free market will provide just as it does with ever other product sold in the U.S.
I am amazed by how many people don't understand competition in the marketplace.
"The most popular channels will of course cost more so folks may end up paying more than they are now.'
By your reasoning Coke and Pepsi should cost $10 for a 16 oz. bottle since they are the most popular.
These are what most people want therefore they can charge whatever they want.
please tell me you do not run a business or are a management consultant.
The market for physical goods/cpg is completely different from Intellectual Property/Content distribution which is essentially what TV is.
In the case of CPG/Physical goods, substitutes are more abundant and switching costs are much lower for the consumer because there is greater similarities between products amongst other secular sector attributes.
However, in media/IP/content distribution only one channel or one set of channels has the distribution rights to your favorite sport/show for the most part. People aren't paying for the channel just because they like that specific channel, they like the content which in many cases is UNIQUE to that channel..whether it is a tv show, sporting event, etc.
For example, disney extracts over $5 a sub per month from every cable/satellite subscriber via their carrier for offering espn. Disney has this pricing power because millions want ESPN because ESPN spends a truckload on the right to televise various sporting events live (hence the ballooning of tv sports rights deals).
If ESPN goes a la carte, a minority of individuals will drop it and in order to maintain the subscriber revenue disney receives, they will rise the per monthly charge.
It depends on how narrow or how wide you define the market. For sports fans, they are a fan of a particular sport/team so switching from their 'coke' to 'pepsi/rc cola/etc' is not something content producers have to worry about as much as cpg manufacturers do.
Also, using the ESPN example, it'll get only more expensive. Why? Because COMPETITORS to them are being developed in form for NBCSN, Fox Sports 1, etc. How do these channels become viable? They need content. However, now with multiple channels/companies fighting over content, prices for content will rise which leads to content distributors (disney/espn, nbcsn, foxsports, etc) having to rise subscription money even further.
Also, going al a carte will reduce the number of individual viewers thereby reducing the rev channels can get from ad buys. A reduction of ad revenue (plus the sub revenue that i previously mentioned) will be made up by channel/content distributors on an individual per monthly sub basis via increases in a la carte pricing.
And when millions of sports fans (or any other mainstream content) see that happening, they'll call their government non-stop.
REmember, you cannot mess with the people's bread and circuses.
Oh on the flip side, for channels barely anyone watches....if you go a la carte, they'll skyrocket in price or go out of business, pissing off small pockets of vocal individuals. like i said, it is stupid for politicians to meddle with peoples entertainment or food.
The content/IP business is very unique in structure and dynamic than most other businesses. Applying simplistic supply/demand models from econ 101 don't work.
For example, disney extracts over $5 a sub per month from every cable/satellite subscriber via their carrier for offering espn. Disney has this pricing power because millions want ESPN because ESPN spends a truckload on the right to televise various sporting events live (hence the ballooning of tv sports rights deals).
If ESPN goes a la carte, a minority of individuals will drop it and in order to maintain the subscriber revenue disney receives, they will rise the per monthly charge...
Also, using the ESPN example, it'll get only more expensive. Why? Because COMPETITORS to them are being developed in form for NBCSN, Fox Sports 1, etc. How do these channels become viable? They need content. However, now with multiple channels/companies fighting over content, prices for content will rise which leads to content distributors (disney/espn, nbcsn, foxsports, etc) having to rise subscription money even further.
I have already seen a bit of a fight between NBCSN and the future Fox Sports 1. Formula 1 racing was until this year exclusively on Speed (Network). This year however, it went over to NBCSN who now basically have ownership of the open-wheel racing market as they own a good number of IndyCar races (previously held by ESPN.) Now why would say IndyCar go to NBCSN over ESPN, something I notice with NASCAR's Nationwide series is over-run sports programming moving races to lesser ESPN networks which for Nationwide races mean ESPNews as they air on ESPN2. IndyCar wanted to be one of a few shows fighting for the same time real estate as NBCSN only has the NHL.
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Also, going al a carte will reduce the number of individual viewers thereby reducing the rev channels can get from ad buys. A reduction of ad revenue (plus the sub revenue that i previously mentioned) will be made up by channel/content distributors on an individual per monthly sub basis via increases in a la carte pricing.
And when millions of sports fans (or any other mainstream content) see that happening, they'll call their government non-stop.
REmember, you cannot mess with the people's bread and circuses.
It will alter it, I still see some of the big boys staying as huge as they are. Nickeledeon, Disney (though ad revenue is not as important for them), ESPN, CNN, MSNBC, FNC, MTV and a few others. As for smaller fringe networks,it would hurt them a lot.
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Oh on the flip side, for channels barely anyone watches....if you go a la carte, they'll skyrocket in price or go out of business, pissing off small pockets of vocal individuals. like i said, it is stupid for politicians to meddle with peoples entertainment or food.
This reminds me of when Disney saw soap operas dying off and turned SoapNet into Disney Junior. Boy that that **** off the loyal soap opera following (well the ones that didn't go to reality television) however it didn't stop the change over because soap operas have lost viewership for years now.
If there is a demand for such "a la carte" service than the cable providers will meet it.
There is no need for the federal government to be involved and such legislation is unconstitutional.
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Lord please let it be so.
