Thoughts on the Future of Cable TV, A La Carte Please

I do not watch a lot of television.  I generally find 4-6 shows I like during a season and stick with them.  I guess you could say that I am pretty loyal to the shows I like.  I do like to follow the entertainment and media industry because I think it has some rather unusual quirks of personality that are unique to entertainment.  Things that would get you fired in any other industry are perfectly acceptable in the entertainment industry.  Things like the head or the WB Network canceling its top rated show, “Angel”;  or ABC firing the creators of “Lost” and “Desperate Housewives” before the shows even aired their pilot episodes.  I think this has been made all the more interesting over the last couple of years due to the writers strike and advancements in internet technology.

On November 5th, 2007 the Writers Guild of America (WGA) went on strike primarily seeking higher residual payments for content delivered over the internet and from DVD sales.  The strike last until February 12th, 2008.  In my opinion there were two (2) major and lasting effects from the WGA strike; it pushed the productions companies and networks towards more reality television at the expense of scripted content.  Secondly it changed the way networks, NBC in particular,  looked at new shows.  I remember a CNBC interview with Jeff Zucker of NBC during the WGA strike in which Mr. Zucker stated that NBC was going to no longer pay to produce pilot episodes and that they were going to implement a new model of show ownership and production.

Technology is rapidly changing the media and entertainment industry.  Cable and satellite now have new competition.  It’s now possible to get “On Demand Programming” directly from networks,  Hulu, Netflix, and a host of alternatives with more competition are on the way.  Over the Christmas holiday we went to visit my sister-in-law.  Her and her husband have “cut the cord” and cancelled their cable subscription.  They now get their television programming through a combination of  over the air digital broadcast and Netflix.  A slow economy is making a record number of people question the need for an ever increasing cable or satellite television bill. I must admit the wife and I are considering our options as well.

The cost of your cable and satellite bills is primarily being driven higher by an ever increasing cost of programming and keeping up with technology advancements; primarily increasing speed and bandwidth requirements.  Programming costs, the amount of money the cable and satellite providers pay the networks for their content, are being driven higher by an increasing number of channels, and the cost of so-called high demand basic channels such as ESPN.

It is currently estimated that the programming costs for ESPN alone accounts for approximately $15 of your monthly cable or satellite bill.  I am a fan of professional and college sports, but that doesn’t mean that I am willing to spend an unlimited amount of money to watch a few games on ESPN every year.  The fact of the matter is that I would get rid of ESPN in heartbeat in order to cut $15 per month ($180 per year) off our annual cable bill.  It is just not worth it to me for the expense involved.   In addition to ESPN, there are a whole bunch of other channels I would get rid off in order to save a few additional bucks.  I guess you could say these channels would be classified as channels I would eliminate for cost saving reasons.

Then there is MTV.  I am not a fan of MTV, and in fact I really do not like the programming it produces.  However since MTV is included in my basic cable subscription package, I am helping pay for the production of the shows MTV produces.  If true a la carte TV was available, I would get rid of MTV in heartbeat.  I would definitely put MTV into a category of channels I would eliminate because I find their content offensive.  There are a few other channels I would add to this category,  MSNBC and a couple of others could be added to this category.

The idea of a true a la carte TV raises a few other interesting possibilities.  I was a big fan of Stargate Universe on the SciFi channel (I like adventure shows with smart people and diverse characters).  If we truly had a la carte TV, then when the SciFi channel cancelled Stargate Universe I could have cancelled the SciFi channel as part of my cable package in order to send a message to the management of the SciFi channel.  I do not think this is a far fetched idea.  People launch letter writing campaigns in an attempt to save their favorite shows all the time, most of the time with little impact.  But if you could send an immediate message to programming executives that hits them directly in their pocketbooks, then you would get their attention; real fast and real clear.

There are obviously going to be a lot of network executives that oppose the idea of a la carte television;  but there are probably going to be a lot in favor of it.  I see a la carte television benefiting networks such as the Fox Business Channel and the Science Channel, both of which I do not get, but would subscribe to if I could find a way to keep the cost manageable.  But the truth of the matter is that I see a la carte television as bringing a form of feedback and responsibility to programmers that I feel most of them are ill prepared to deal with.  They simply do not want the feedback and input they would receive from their customers by giving them the ability to add or cancel channels at will.  I do see cable and satellite companies making a limited effort at this; but that will most likely be on a bundled basis of say all the NBC channels or ABC channels.  I am in favor of full a la carte television where you can pick every channel on an individual, stand alone basis.  Then consumers will really be able to pick and choose, control their costs, and send a message on what they think of the programming. I really think that in order to achieve this, it will take a regulatory change from the FCC, and possibly new legislation in order to open this up to consumers.    If you feel as I do,  then I suggest you write your Congress person and request the change.

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