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A la carte cable not such a great idea...

OILFIELDTRASH said:
http://www.theatlantic.com/business...-cost-more-than-your-whole-cable-bill/277916/
This almost makes cable seem like a good deal.
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Kinda like comparing a-la cart do a meal deal.

Someone buying everything included in a package individually just doesn't understand wtf a-la cart is meant to do....

A-la cart would work for tv watchers like me (if you can even call me that) who watch a handful of shows/channels and don't have any interest in sports, spanish, home improvement. This is where it applies.
 
A la carte, for a majority of TV watchers, makes no sense. If you are single and/or your family only watches 1 or 2 channels, you might save money. Otherwise, you're probably going to see an increased bill. What we have now is essentially socialized television, where everyone is subsidizing everyone else, so that less popular channels can survive. A move to a la carte would allow actual market principles to determine the winners and losers. Less popular channels would become very expensive, cut programming, or go away completely. You'd probably end up with 5 or 6 mega channels sticking around and the rest becoming very niche and low budget or shutting down.
 
The important part is the last line. If people knew how much particular channels *really* cost they'd just stop paying. And then those channels would be forced to lower their costs to attract back subscribers. And it's a trickle down from there. Does the NFL deserve a 15 BILLION dollar deal from ESPN? Those kind of contracts would shrink too. And that's not necessarily a bad thing either.
 
I glanced, and I think the jist of the story is 'If people who don't watch the channels stopped subsidizing the people who do, then the channels will have to raise their subscriber cost to make up the difference.'

This is basically THE argument against a la carte cable and presumes that it would happen across all providers and subscribers simultaneously. I agree with it, for the most part. There's a lot of channels that are "popular" channels that I would never subscribe to. AMC is one. If AMC lost 80% of it's subscriber base by going a la carte, they'll have to do one of two things. Increase the cost per subscriber or take the hit. If they take the hit, then they won't be able to produce shows that some of you like because they simply won't have the budget. They'd likely charge more. Best I can find is that AMC currently costs about .75 per subscriber. This would probably at least triple in a al a carte system. So you're looking at $2.25. This doesn't sound like a lot, but this would basically happen to every channel. Assuming $2 a channel minimum, it wouldn't take you but 15 of what I would consider "basic package" channels to hit the monthly fee of most basic cable packages that include those channels anyways, plus dozens of others.

On the other hand, I would like more of a fair market system where channels live and die based upon whether or not people watch them, instead of being subsidized by a large subscriber base. It is kind of annoying flipping through hundreds of channels that probably shouldn't even exist.
 
It's moot because everything is moving online now. The traditional television structure is breaking down in favour of streaming alternatives that let you watch what you want, when you want, where you want. The real problem will be how to monetize it. Especially due to net neutrality, which I do think is a good thing but it makes for interesting business challenges.
 
on one hand, bundling allows a greater variety of channels to be accessible to the average viewer

on the other hand, bundling allows a great amount of crap to be foisted on the average viewer
 
I asked a friend from the cable industry to forward the entire 34-page report to me, and here's the money chart (click to enlarge).
Click to expand...

Yeah, sounds like a great report if I need to grow mushrooms.

-KeithP
 
vi edit said:
The important part is the last line. If people knew how much particular channels *really* cost they'd just stop paying. And then those channels would be forced to lower their costs to attract back subscribers. And it's a trickle down from there. Does the NFL deserve a 15 BILLION dollar deal from ESPN? Those kind of contracts would shrink too. And that's not necessarily a bad thing either.
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Pretty much this. Most of the channels are able to charge so much because it's gradually trickled into the system. Compare the budget of PBS to the budgets of those expensive channels. PBS provides a ton of excellent programming. The difference is, they don't tell the cable companies "pay us a lot more, or we'll tell all your subscribers that it's your fault for dropping us." In turn, the actors, "we deserve $50,000 per episode, because you're making so much more money." Etc.

The lack of a la carte has created a socialized model where one end is simply able to extort more and more money from the system.

It's almost weird - I'm aware of one particular 30 minute show. 100% of the show is produced independently of the station that carries the show. But, in order for that station to carry the show on air, they required, I think, something to the tune of $40,000 in advertising. This was one of those shows/channels that probably doesn't have a lot of viewers (it should though!) I find it difficult to understand how the end customer is also paying for that show - where do the other costs come from ($80k/hr costs)?
 
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ESPN isn't even worth $10/month. AMC is certainly worth $10/month to me. It is the second best fiction-producing network after HBO. FX as well. If you let me dump all the channels I don't watch and charge me $5-10 for the ones I do, it's not going to be that much worse for me in the immediate term. And I suspect I'd get either way better shows long term or lower costs, or a combination of both.
 
Wait a second...
Something just struck me as mathematically WRONG.

Seems it should be a zero sum type thing. Let's say total revenues for all channels are x. There are n customers. Then, the average each customer pays is x/n. Assuming that the station's income was maintained to be the same, then the total revenues for all channels would still be x, and the number of customers would still be n. THE AVERAGE COST IS STILL THE SAME. You simply can't get around that. More importantly, and obviously, a lot of those really crappy stations with few viewers are going the way of the dodo. Thus, the total revenues required would be less than x, and the average cost would actually go down. Further, this would lead to competition and, perhaps better programming on some channels. Plus, as viedit alluded to, it would result in a market correction for those football players and other sports players salaries that have grown many many faster than just about anything else.
 
DrPizza said:
The lack of a la carte has created a socialized model where one end is simply able to extort more and more money from the system.
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And yet, this country is headed this way in other areas - yes, I'm talking about healthcare.
 
DrPizza said:
Wait a second...
Something just struck me as mathematically WRONG.

Seems it should be a zero sum type thing. Let's say total revenues for all channels are x. There are n customers. Then, the average each customer pays is x/n. Assuming that the station's income was maintained to be the same, then the total revenues for all channels would still be x, and the number of customers would still be n. THE AVERAGE COST IS STILL THE SAME. You simply can't get around that. More importantly, and obviously, a lot of those really crappy stations with few viewers are going the way of the dodo. Thus, the total revenues required would be less than x, and the average cost would actually go down. Further, this would lead to competition and, perhaps better programming on some channels. Plus, as viedit alluded to, it would result in a market correction for those football players and other sports players salaries that have grown many many faster than just about anything else.
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Your math is accurate, however the issue is that under a la carte, you will have some who will pay more and some who will pay less. Well, you know how this country is headed, everyone should pay the same, right. We can't have people paying more. That's UNFAIR!
 
If some of these channels want to charge too much, they will find out soon they need to lower the price or spend less money on programming.

I really don't think any channel should be subsidized by the current method of TV. I am a sports watcher, and I think we need to go to an a la carte method even if the price goes a lot higher.

If that were to happen, I would just drop sports. But even at $30 a month I would come ahead since I watch sports and network(which is free). But likely, I would just drop the really expensive channels.
 
You know, thinking about this some more, HBO, Showtime, Cinemax, even Playboy are already a la carte and they do fine enough to survive. There's even a la carte Soccer and Rugby channels. People will pay if the price is right and content is good.
 
I'm for al la carte cable and will supplement with Netflix ($8) & Amazon Prime ($7) streaming, so even if every channel I want is $5/each then I can get 7 channels I'll actually watch and still work out to $50/month all-in.

More than likely I'll just keep one or two channels + OTA, and drop my bill by $20/month (doubt that will be allowed to happen).
 
bearxor said:
Assuming $2 a channel minimum, it wouldn't take you but 15 of what I would consider "basic package" channels to hit the monthly fee of most basic cable packages that include those channels anyways, plus dozens of others.
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If you need 15 channels, then you can just get basic cable. I couldn't even name 15 channels.

They should do it like the old AOL and charge by the hour.
 
As long as I cannot get a la carte programming via the cable company, I will not subscribe to television.

Been "cord free" for 3 years and haven't looked back.
 
CPA said:
You know, thinking about this some more, HBO, Showtime, Cinemax, even Playboy are already a la carte and they do fine enough to survive. There's even a la carte Soccer and Rugby channels. People will pay if the price is right and content is good.
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You have to have a cable package to get those, so it's not really.

I look forward to the day when I can sign up for AMC, ESPN, TNT and that's it. However, there's no way I'd pay $30/month for just ESPN, that's hilarious.
 
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Honestly at this point I won't carry cable even with al-carte programming. Internet enabled or nothing.

I want to watch my shows, on my time, and I don't want crappy PVR boxes and other crap on site.

Basically, give me hbo.com with the ability to subscribe to a show or the whole channel and watch them on demand.
 
CPA said:
You know, thinking about this some more, HBO, Showtime, Cinemax, even Playboy are already a la carte and they do fine enough to survive. There's even a la carte Soccer and Rugby channels. People will pay if the price is right and content is good.
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no they are not

i cant call up TWC and cancle all my crap and keep HBO, im forced to have it as a 20$ addon to a 40$ plan or whatever it actually costs
 
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