Re: a la carte won't save most people any money in http://www.dslreports.com/forum/r14926307 en Sat, 05 Dec 2009 18:05:22 EDT Sat, 05 Dec 2009 18:05:22 EDT Politically motivated http://www.dslreports.com/forum/remark,14946981 glparker4 : I'm surprised that nobody here has mentioned the politics involved in this issue. When this study of a la carte was released, FCC Chairman Kevin Martin mentioned that cable a la carte pricing would give parents more control over what content enters their home. Also, Martin touted the idea of cable and satellite companies providing family-friendly tiers and hinted that the cable content providers should clean up their act (even though they are not under the same regulations as broadcast TV). Also, Rep. Ted Stevens (R-Alaska) has sponsored a bill to allow the FCC to regulate cable and satellite TV just as it does broadcast TV. Right now, cable companies are an easy target because many consumers are disgruntled with the constant price increases. This is definitely not a good time for Comcast to pass along a nationwide rate hike!

Personally I would like to see a la carte happen. I don't watch any sports channels, but I was forced to subscribe and pay for them. I would like to receive channels like TechTV (now G4) and Logo, but I would be required to get Digital Plus and pay for 200 other channels that I'll never watch. I'm sure all of you would gladly help me get Logo moved to basic so that you guys could subsidize it for me and get my cable bill lowered...HAHA :D As absurd as that sounds, that's how I feel about having to pay at least 60% of my cable bill for ESPN, ESPN2, ESPN Classic, Golf Channel, Speed, Fox Sports, and even the garbage that is now on MTV, VH1, E!, and BET. If some of these channels are your favorites, I expect a 'thank you' since I have been subsidizing them for you for the past 10 years :p

However, I have to say this idea of a la carte is nothing more than wishful thinking and political fluff so politicians can win votes with angry consumers.

First of all, big media companies have a lot of $$$ invested in their cable networks. Anything that threatens their lucrative business model will be fought long and hard. These vulnerable politicians would not stand a chance. By the time the FCC starts receiving input on this issue a new administration will be in-house with a different policy.

Second, many politicians have not weighed in on this issue yet but some feel that this is capitalism and the marketplace should dictate how these businesses operate. We seem to forget that it's not just Comcast that engages in this business practice of bundling content. DirecTV and Dish do the same thing. Dish offered a package called Dish Select in the 90's where a subscriber could chose any 10 channels that he/she wanted for $15. Ironically, nobody chose this option and the package was dissolved. I don't think that the package was profitable for Dish either. It is true that the satellite companies do not increase prices as frequently but an above post mentioned the hidden costs such as buying equipment and additional box fees. Also, let's consider the two satellite radio providers, XM and Sirius. Both companies are constantly adding new sports and famous personalities every year. As an XM subscriber, my rates have increased from $9.99 to $12.99 last year. I originally got XM for 10 music channels that I enjoyed but I am now paying more for Major League Baseball, Opie & Anthony cursing, and Snoop Dogg playing his favorite songs once a week. Also, Sirius has hinted that their users may experience higher prices because they have added such vale-added content such as Howard Stern's uncensored masturbation sessions and Martha Stewart baking cakes on the radio. Why doesn't the FCC require a la carte satellite radio so that they engage in this pricing cartel like the cable companies do?

A la carte would definitely benefit the consumer, but people should not look to the government to make such imposing rules to force companies to provide what we want. Did we learn anything from the AT&T breakup? I think that the only option for a la carte will be receiving programming over the internet (legally, of course). One good example of this is iTunes. Disney has tested the water by providing ABC and Disney Channel shows on an a la carte basis. This has proven to be very successful reaching 1 million downloads within a week, but Disney has encountered several issues with actors' unions and ABC affiliates not being compensated. Fox and Universal-NBC are talking to Apple and are expected to follow suit.

For those of you unhappy with your cable company, you have several options. Switch to satellite. Personally, I don't see this as a good option because I have three TVs in my household which would increase my monthly bill. So, instead of giving my money to Brian Roberts every month, the same amount will be going to Rupert Murdoch or Charlie Ergen.

You can also kick the habit of paying for cable all together and just use an antenna. Now that many TV station are broadcasting digital signals, you can experience crystal clear over-the-air reception with little interference. I have a digital over-the-air receiver that downcoverts the HDTV signal for my analog TV. I'm located north of Atlanta, and I receive all network affiliates perfectly and get TBS over the air for free, an added bonus :D You can also join subscription services like Netflix and Blockbuster Online. I joined Netflix which was much cheaper than getting HBO from Comcast since I am an analog subscriber and I would be required to upgrade to digital. Also, with these services, you get to choose whatever movies you want unlike HBO.

Sorry if this post got a little long but this is just some stuff to think about. Here is the article from the Washington Post that discusses some of this...
»www.washingtonpost.com/wp-dyn/co···chnology

Cheers!]]> http://www.dslreports.com/forum/remark,14946981 Sun, 04 Dec 2005 19:17:53 EDT Re: a la carte won't save most people any money http://www.dslreports.com/forum/remark,14932478 Skippy25 : Really he doesn't.

ESPN, CBS, FOX, NBC bid in an open market to get distribution rights to these sporting events. They set the price they are going to pay for these events, the event coordinators / leagues don't. They may have a starting price, but until someone is actually willing to buy something the true value is $0 and the ending value is simply whatever the most money the last person standing is willing to pay.

Of course that gets passed down to the consumers and the advertisers. Of course, we the consumers, get it again when we go to purchase those products being advertised.]]> http://www.dslreports.com/forum/remark,14932478 Fri, 02 Dec 2005 13:29:25 EDT Re: a la carte won't save most people any money http://www.dslreports.com/forum/remark,14932442 Skippy25 : ESPN and others will simply need to renegotiate their fees or be forced to charge unreasonable fees for their services to those that do want it. Since this would hurt them and the events wanting to be broadcasted I think they will easily come to terms on this.

I agree many channels will lose subscribers as they should (and be cancelled), but many will also gain subscribers. I know people, including myself, that do not have certain channels because we would have to purchase another package that has several others we don't want. To me the cost for all those "extras" is not worth it for the very few channels I want.

Beyond local channels their are only about 8 or 12 other channels I would get. Only about 6 of those would be for myself and my wife, the rest for my kids. Sure I am willing to pay more for HD and DVR service, but is it worth an additional $12 a month on top of the already bloated fees I pay now? I personally say no, but I may reconsider that when I can get the channels I want for less then I have to pay for all the crap I get now.]]> http://www.dslreports.com/forum/remark,14932442 Fri, 02 Dec 2005 13:23:24 EDT Re: a la carte won't save most people any money http://www.dslreports.com/forum/remark,14931574 marigolds :
said by G_Poobah See Profile :

Actually, your logic is so fatally flawed it's laughable.

By YOUR definition, the content providers get the SAME AMOUNT MONEY no matter how many people subscribe? In what magical land (north korea) is that true?

Let's carry all the way to the extremes, using the model you posted. So if only 3% of the subscribers get ESPN, then it would cost 126.56/month per subscriber. That's what the math comes out to. So of course, ESPN still gets the same revenue with only 3% of the people willing to pay for it?

ESPN BY ITSELF could not support the rates it is charging. Even at 100% subscription, it's getting 3.90/person. Please explain how I, the customer, am forced to pay 3.90/month for something I don't want. If I use the corporate apologists argument of 'it's not necessary', then YES, I agree with them. I don't want ESPN! I don't want to pay for ESPN! I WANT to vote with my pocketbook, but wait, I CAN'T. Cause I can't get the channels I DO want to vote for with my money unless it comes in a package with ESPN. If you don't see the total hypocrisy of the corporate apologists line there, then you must be blind.
His logic is not that flawed, it is just missing an element. ESPN has to get the same amount of revenue because they have to pay for all of those sports programming contracts.
If ESPN was getting only 3% of the subscriber base, they would cut back significant on their program offerings so that their costs can meet their revenue. Keep in mind, if ESPN were forced to drop these offerings they would just end up going to the broadcast networks who have must-carry status and they still would come out of your pocketbook. And ESPN gets way more than $3.90/person. Somewhere close to $11/person in ESPN/ESPN II areas and $15/person in ESPN/ESPN/Classic areas. Sounds like a lot, but its no more than HBO.
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said by G_Poobah See Profile :

Actually, your logic is so fatally flawed it's laughable.

By YOUR definition, the content providers get the SAME AMOUNT MONEY no matter how many people subscribe? In what magical land (north korea) is that true?
It's not really my logic. It's the FCC and content provider's logic. I'm not saying that they will get exactly the same amount no matter how many subscribe.

I think it would be safe to presume that under a la carte pricing, many channels would see a reduced number of subscribers. Just because the channel has fewer subscribers doesn't mean the operating expenses also decrease. They would stay more or less the same. However, since the channel will have fewer viewers, advertisers won't pay as much for fewer eyes watching. So the channel loses money in the process. That lost revenue has to come from somewhere, so they have to raise rates to create a balance.

ESPN charging $126 is absurd. Obvisouly they can't sustain a viable business charging those rates. If they were to do that they would price themselves out of business. But charging $15 I think is within the realm of a possibility.

With a la carte pricing, I will guarantee you that there will be fewer overall choices in channels because many of the small niche channels will essentially price themselves out of existence.
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By YOUR definition, the content providers get the SAME AMOUNT MONEY no matter how many people subscribe? In what magical land (north korea) is that true?

Let's carry all the way to the extremes, using the model you posted. So if only 3% of the subscribers get ESPN, then it would cost 126.56/month per subscriber. That's what the math comes out to. So of course, ESPN still gets the same revenue with only 3% of the people willing to pay for it?

ESPN BY ITSELF could not support the rates it is charging. Even at 100% subscription, it's getting 3.90/person. Please explain how I, the customer, am forced to pay 3.90/month for something I don't want. If I use the corporate apologists argument of 'it's not necessary', then YES, I agree with them. I don't want ESPN! I don't want to pay for ESPN! I WANT to vote with my pocketbook, but wait, I CAN'T. Cause I can't get the channels I DO want to vote for with my money unless it comes in a package with ESPN. If you don't see the total hypocrisy of the corporate apologists line there, then you must be blind.
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It's all a numbers games and only estimates can be used. This USA Today article has a small chart at the bottom that shows how a variety of channels rates would be effected by only a portion of total cable subscribers subscribing to that particular channel.
 Subscriber rate                 75%     50%     25%
Disney Channel                  $1.97   $2.95   $5.90
ESPN                            $5.12   $7.79   $15.82
MTV                             $0.64   $1.06   $2.32
Fox News                        $0.70   $1.06   $2.17
TBS                             $0.69   $1.12   $2.42
Mandated broadcast buy-through  $10.00  $10.00  $10.00
Total bill to consumer          $19.11  $23.99  $38.61
I beleive ESPN now gets around $3/subscriber. Their rates are estimated to quintuple with only a 25% subscription rate under a la carte pricing. If I wanted to subscribe to just the basic required package and just ESPN, I would almost be paying as much as what I am paying now. That's probably the most expensive rate increase, but as you can see other channels have similar percentage increases. If you want more of a niche channel, like the History, A&E, or Food Channel, expect your rates for those channels to increase significantly.

The poster above said that most people would see an increase, not all. I honestly think most would see an increase.

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"What gives them the right to come in and do this?" she said. - Lady complaining that she was getting FIOS in her backyard.]]> http://www.dslreports.com/forum/remark,14930412 Fri, 02 Dec 2005 07:13:38 EDT Re: a la carte won't save most people any money http://www.dslreports.com/forum/remark,14928832 marigolds :
said by Minister See Profile :

Thank you Rich, but in this class we show our work on worksheets or we get no credit for the assignment.

Could you show your numbers?
He can't show those numbers. Content providers craft contracts that keep those numbers sealed.
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If anything, it will make prices higher, or even put many niche networks out of business all together.

Congress and the FCC need to be whining about the programmers like ESPN and not the cable operators.]]> http://www.dslreports.com/forum/remark,14928516 Thu, 01 Dec 2005 22:23:50 EDT Re: a la carte won't save most people any money http://www.dslreports.com/forum/remark,14927562 TKJunkMail : NM. Discussion is going off topic.]]> http://www.dslreports.com/forum/remark,14927562 Thu, 01 Dec 2005 20:19:46 EDT Re: a la carte won't save most people any money http://www.dslreports.com/forum/remark,14927489 kamm :
said by TKJunkMail See Profile :

A la carte programming costs will be such that it will never really save most customers money. For those who rarely watch TV and are satisfied with bare bones basic cable, a la carte could help them cut costs where they can take basic plus one or 2 favored channels. But for those who like a smattering of sports, movies, some HDTV, childrens shows, and a music channel or 2, the costs will turn out to be the same(but with less channels to watch).

Of course, it's false again.

Rich, Rich, you're waaay too well-known here as the puppet of Big Business - do you really think people are totally dumb and cannot calculate how much they could save?
ROFL.]]> http://www.dslreports.com/forum/remark,14927489 Thu, 01 Dec 2005 20:09:43 EDT Re: a la carte won't save most people any money http://www.dslreports.com/forum/remark,14926990 jazzy112 : ESPN is half your bill, get rid of that and you'll be way better off. Me, All I need from my Sat provider is the discovery networks and the HD channels and I would be happy. I get NBC and Fox crystal clear HD off air and better looking than the feed from the sattelite. That's all I ever watch, that's all I should pay for. For those of you who like sports, your bill will increase, because the per subscriber rate will go up when they lose half or more subscribers currently forced (well I guess only forced if they want sat or cable) to pay for it. The even bigger bonus is, the really crappy networks nobody wants to pay for will just go away and not be a nuisance any longer. :) And better yet, none of my money would go to Faux News :) ]]> http://www.dslreports.com/forum/remark,14926990 Thu, 01 Dec 2005 19:05:08 EDT Re: a la carte won't save most people any money http://www.dslreports.com/forum/remark,14926773 nasadude :
said by Minister See Profile :

Thank you Rich, but in this class we show our work on worksheets or we get no credit for the assignment.

Could you show your numbers?
my thoughts exactly. put up or shut up.]]> http://www.dslreports.com/forum/remark,14926773 Thu, 01 Dec 2005 18:38:11 EDT Re: a la carte won't save most people any money http://www.dslreports.com/forum/remark,14926318 Minister : Thank you Rich, but in this class we show our work on worksheets or we get no credit for the assignment.

Could you show your numbers?]]> http://www.dslreports.com/forum/remark,14926318 Thu, 01 Dec 2005 17:39:17 EDT Re: a la carte won't save most people any money http://www.dslreports.com/forum/remark,14926307 guitarzan :
said by TKJunkMail See Profile :

A la carte programming costs will be such that it will never really save most customers money. For those who rarely watch TV and are satisified with bare bones basic cable, a la carte could help them cut costs whree they can take basic plus one or 2 favored channels.
Local channels and basic plus sports would suit me fine.
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