As Expected, Intel Runs Face First Into TV Licensing Wall → Re: Will you save money?

Your numbers just aren't correct. There are examples out there today of what such pricing would be like. For example, Verizon carries a channel called Wealth TV. It's a VERY cheap channel for them to carry. I think they get it for something like 4 cents/subscriber. The thing is, Wealth also has an ala carte option - you can get the channel through devices like Roku. How much does it cost you to subscribe to the channel that way? $5/month. Why so much? Because of how the business model works.

With the traditional model that cable companies follow, the channel gets paid per subscriber that has access to the channel. Whether they watch the channel or not. This is why content providers really want cable companies to carry their channel on the lowest possible tier. The lower the tier, the more subscribers that have the channel, and therefore the more money the content provider makes on the channel. But if you were to pay for the channel directly, the content provider has to charge you alot more for the channel than they charge the cable company, because there are far fewer people who would actively go pay for the channel. And since offering a channel's content isn't free... they have to get so much cash-flow to make the channel profitable. And remember, this is a tiny little channel that costs cable operators next to nothing to carry. Imagine how much an ESPN or Disney or Fox News would cost you ala carte.

I'm not a big fan of the ala carte option mainly because, at the end of the day, you'll spend just as much as you do now, but only get a fraction of the channels. If I'm going to spend $100/month anyway, I would much rather have 300+ channels for that money. Even channels I wouldn't normally care about occasionally carry program that I like. I don't think the reason ala carte hasn't taken off is because of some conglomerate somewhere stopping it. I think it's because the current model is far more efficient at providing the biggest bang for your buck. These companies, in other words, are serving the wants of their customers. Doubt that? Just peruse some of these forums - how many people get their panties in a twist over channel counts? Alot. People get really upset when the provider they use has fewer channels than other providers. If the market really was demanding ala carte, I think these guys would be falling all over themselves to provide it. I just don't think the demand doesn't really exist for it.