What happened to "a la carte"

Someone forcing you to write that check?

In a nutshell, HD does not pay for itself, yet. Cablecos make their money from those tiers. The cableco's argument: If they charged you for those 15 channels at a rate that would pay for the equipment they installed to bring them to you, the fees they pay to get those channels and a little profit for themselves, you could easily end up paying 8 - 10 bucks per channel.

Doc

In the end, you'll pay over $100 per month either way. Any change to the pricing of cable television will necessarily need to be revenue neutral. Figure you watch three of fifteen channel on a tier, which costs (say) $20 -- count on a la carte costing you $8 per channel per month. So you're better off paying for all fifteen channels than paying for each of the three a la carte.

Of course with the advent of true competition -- cable, telcos, DBS and perhaps even the internet -- someone will offer true a la carte sometime in the relatively near future.

And the vast majority of viewers will save money. Of course the cable companies will use lobbyists, plaintive wails, and anything else to keep a la carte from being allowed. Just as they are screaming about having to pay for carriage of local stations -- even though DBS and the telcos do that now, and tend to have cheaper rates.

But the big scare tactic will be that it won't save you any money. Does anyone believe the cable companies care about saving you money?

DBS has bee around for what, 12 years now. Telcos have been dabbling in video for years... Still no a la carte. A la carte will only come to pass when the bulk of the rights holders decide they can retain their income with that business model. Case in point, the NFL Network. Now who wanted to place a sports channel on a sports tier and who wanted it pumped into every home in the country?

Perhaps.

But a la carte could also come to pass when legislation is passed making it illegal for networks to force "basic" carriage on providers as part of their contracts.

For comparison...here's the English HD channels you will get for $29 US/month with StarChoice...

National Geographic HD
Showcase HD
TSN HD
NBC Detroit HD
ABC Detroit HD
CBS Detroit HD
PBS Detroit HD
FOX Detroit HD
NBC Seattle HD
CBS Seattle HD
FOX Seattle HD
CBC Toronto HD
CTV Toronto HD

And still charge $8 per channel regardless.


That's the only thing that won't happen. While more competition will provide downward pressure on prices across-the-board, such effect will benefit those on packages just as much as anyone else. Rather, with regard solely to the introduction of a la carte pricing, if it ever occurs, some folks will pay less, and some folks will pay more, and on the average it'll even out. I suspect that those who are the greatest fans of television (i.e., US) will be the ones who lose out when a la carte pricing is introduced. In general, we'll be the ones who have to pay more than we would have if things were left as they are now.

Just what we need -- more government interference!?!?!

Someday, perhaps, the nation will turn back to the tax-and-spend "government will take care of you" perspective of the 1970s. Until then, expect that government will take a role only when there is a compelling national economic or defense interest, not a compelling personal interest of television fans.

Then stop paying for it. I get a lot more than 15 channels and I don't pay a cent. Over-the-Air antenna gives you a better HD picture and it's free. Save yourself the $1200 a year and then buy yourself a new TV with the money.

They could also move sports channels to a sports tier and save us all alot of money. (and, to be fair, movie and other selective expensive channels could create seperate tiers)
Doesn't ESPN charge like $3/month just for ESPN-SD?

Sports Tier--$15/month
ESPN/HD
ESPN2/HD
ESPN News
ESPN U
ESPN Classic
NFL Network/HD
VS
MASN (Standard-Def DC RSN that costs ALL Comcast subs in area $2/month)
etc

You're assuming they would only charge what they're being charged. And, if they moved sports to its own tier, they would charge whatever the market would bear. Without a base package, or with just bare-bones basic cable, they'd probably slap you with something closer to $30 bucks for the sports tier and another 10 to get it in HD. Supply and demand.

C Band a la cart became viable for consumers when its demise was assured. Maybe when the telecoms become players?? (for everyone) But then we start over.

Yup, I'm amazed at the number of people who buy expensive HDTV sets and won't pay the $100 it would cost for a decent outdoor antenna and some wire to pull in a free signal. And, you could record the HD with a Myth box or find one of the Sony HDD units, and still save money over the cablecos.

That's one thing people don't realize: the cable company can offer the discount on a package because they can make money by offering channels that way.

People forget that all those shopping channels pay to be on multi-channel systems. In addition, cable companies sell advertising on various cable nets based on the number of eyeballs that are subscribed to that particular channel. Cable companies get discounts on popular channels from content providers based on adding smaller, less popular channels from those companies.

All those things add up to a savings that can only be achieved with a package deal. Sure, the cable company could bite the bullet and take less profit from an Ala Carte package, but don't expect the kind of infrastructure upgrades that you see going on right now. Expect your box rental to go up, since profits from subscription fees subsidize the cost of that propriatary equipment. For that matter, kiss your current analog service on that older TV in the den goodbye since this can't be done without a box - for that matter, I don't think even cable card TVs could even work with ala carte. If they can't get PPV or other similar service items to work with it, Ala Carte certainly isn't going to be any easier.

I think what will happen is the number of packages will eventually increase to allow for family friendly, sports geared and perhaps basic lifeline packages to fit the needs of more customers, including those that only want their local stations but can't get them OTA.

That technique should keep the feds happy while providing a realistic way for cable companies to pull it off.

Cable co's are always going to get their money out of you. I honestly think it's a fantasy that somehow a person will manage to get just what they want and pay less, and that other people will somehow make up the difference. If the average is $60 (just making a number up) then they will always get an average of $60 out of most households.

It's the same reason upgrades come at a slow, measured pace--they are also limited by that same average, ie, no matter how great the services they offer, there is an average limit most households are willing to pay.

Over time the services will improve (along with a slow creep in price), but maybe enough competitors will enter the market to drive the overall price down just a bit. I don't see any big change.

That's the bogus claim they are making against a la carte. How many will subscribe to Spike, Lifetime Movies, TCM, etc. for $8 a month each? Hardly any is the correct answer. The obvious result is they will have to lower their price to entice subscribers, or become completely ad supported and offer the channel for free to maximize their carriage. Or if demand is limited for their channel, they can close their doors.

As far as shopping channels, those can be offered at no charge and subs can be forced to specifically decline any free channels. Most will allow any free channels to be supplied.

The whole "revenue-neutral" argument is BS. Charging $15 - $20 a month for ESPN will not result in the same revenue because as the monthly fee goes up, more and more people will refuse to subscribe - then they'd have to jack it up even higher to offset the lost subs. That's not realistically how it would happen. Each channel would end up priced based on the demand for that channel - and I'd wager even ESPN would have to decrease their price in order to have a chance at survival. (and with their current sports contracts, even that probably wouldn't work)

No, it is a reasonable estimate of how much a la carte channels will cost. I know that upsets folks who wish things were less expensive, but that's life.


Absolutely not. The "obvious" result is that they'll package these channels with others, onto a tier, and sell the tier.


I'm sorry that economic reality upsets you.

Hogwash. You really believe that people will buy Discovery or FMC for $8 a month? If enough people do, then fine - that's what it's worth. But they won't, and the market will force the price to drop.


Then that's not a la carte now, is it.


Believing that people will pay $8 per month for a cablenet shows that economic reality has nothing to do with your argument.

My respones to this is: beware of opinions that are trying to masquerade as facts. This particular opinion is essentially repeated verbatim from the lobbying handbook for the cable industry and may or may not reflect reality. My suspicion is that a la carte would result in a drop in programming costs for the average viewer (an opinion that matches the FCC's most recent study on this subject) -- but it would result in a rather substantial drop in profits for companies like Time-Warner, Viacom, NBC-Universal, Disney, and News Corp. It would also, most likely, reduce profits for cable and satellite operators, as well. But I'll be honest enough to admit that this is an opinion based on my analysis of the media world. We won't have any hard facts on this until a la carte service becomes widely available.

Now, to attempt to answer your question: we don't really know when (or if) a la carte will ever happen. There are some powerful lobbying interests in big media that will fight very hard to keep it from happening. On the other side are some consumer groups (notably Consumer's Union, publisher of "Consumers Report") and social conservative groups. There is support for a la carte in both the Democratic and Republican parties. There is also opposition to a la carte in both parties, as well. The battle over a la carte cable services could also interact with a couple of other hot industry battles (multicast must-carry, retransmission consent, and the FCC's indecency rules) in ways that are difficult to predict. The outcome of all of this is incredibly difficult to predict -- it could happen in 2008, it could happen in 2015, it might never happen.

However, you aren't without options in the interim. As a Phoenix-area viewer, you should have access to multiple channels of HD programming from your local affiliates. This programming is available free of charge to viewers who use an antenna to receive it instead of subscribing to cable or satellite. These channels are often unencrypted on cable systems, so if you have an HDTV that has a QAM-compatible tuner you may be able to receive your local HD broadcast channels without subscribing to an HD package -- in fact, those channels should be available even with the cheapest "lifeline basic" service that your cable company offers. You may want to look for the Phoenix HDTV reception thread here on the AVS Forum and see how these options work in your local area. Another option that used to be available was that Dish allowed viewers to subscribe to only HD channels -- I haven't heard about this in a couple years, so I don't know if it is an option that is still available, but it is certainly worth checking into. HD programming from Dish combined with what you can receive using an antenna would give you a lot more than 15 HD channels for a lot less than $100/month.

Well?? I've bought 5 (each progressively better) set top boxes, 4 different antenna ( each progressively better) to get satisfactory OTA HD. Damn my site, but adding it up, I could get years of HD programming from E*. Only difference is independence and granted, better OTA HD. And now, I'm not really sure HD will stay at least as it is, cause I feel HD Lite will creep into OTA. A la carte should have been included into the past and revised home viewer's sat act. But we don't lobby enough.

Thomas Desmond summed up the situation very, very well. A la carte is an issue cable companies thought was dead just two years ago. But now, they are in a real fight.

FCC Chairman Martin is strongly in favor of a la carte. In the end, he sets the agenda at the FCC.

So despite the heavy lobbying by the cable companies, it is an issue which is not going away anytime soon.

I have D* Total Choice Premier. So that is basically all the channels except for foreign language channels.

The question for me is, if a-la-carte was implemented, would my bill go up?

The real issue is will our bills continue to rise unchecked if nothing changes?

Gosh, that's a compelling argument.


I see your problem: You don't read the messages you reply to.

I never said anything of the sort.

Go back and read what I wrote and then come back and chat with us, if you'd like.

Everyone has their own studies, to "prove" whichever side of the argument benefits them the most, I suppose. I'm an anamoly, in that regard: It believe the studios that actually DON'T benefit me, because the facts underlying those studies are more compelling -- fit better with my experience in the mass-market.

Regardless of the equivocations, look around you. Assuming that this will come down a fight between business and the consumer, given who we've elected to Congress and put in the White House recently -- Who do you think will win that fight?

I don't think that we will ever see ala carte from the Cable/Sat/Telco providers. But I think that the Internet will give it to us instead. Just give it a few years.

Rise, yes. Unchecked? It depends. Competition is always the key to that. Let the telcos get fiber to the home and we'll see what happens. (Though that could backfire, too. I can see TW forking over a truckload of money to Disney for exclusive terrestrial carriage of the ESPNs.)

The danger of a la carte is that the price point for ANYthing is always set at what the market will bear. So, with limited competition, you can expect the most popular channels to fetch the highest prices. And, with that happening, a handful of must-have channels will quickly rise to the price you're paying for a whole bundle of them, now. You can try to legislate that to keep it from happening, but corporations will not stand for the reductions in profits that will cause. They'll either make it up some other way (look at your phone bill or bank statement for some idea of what I'm talking about), dial back their own expenses (think Indian call centers, service call fees & contracted installers) or just get out of the business, altogether, selling it all to someone who knows nothing about the business.

And are we really ready for Wal*Mart Cable?