http://www.tbnnetworks.com/downloads/NetworkFolders/TBN_Satellite_Change_Q&A.pdf

Let’s just skip a step and turn cable into an On-Demand service.

http://tvbythenumbers.com/2008/12/31/cost-per-cable-channels-as-a-function-of-ratings/10102

Obviously, in any A La Carte discussion, we must remember they’d give us QVC, HSN and ShopNBC for free since cable outlets get a hefty percentage of purchases by locale. I think it’s 5%. Why not give away other messages that are paid for only to be heard, like the religious networks?

If I’m wrong I’m curious about how much religious channels earn per subscriber.

57 Channels (and Nothing’ On)

I bought a bourgeois house in the Hollywood hills
With a truckload of hundred thousand dollar bills
Man came by to hook up my cable TV
We settled in for the night my baby and me
We switched ’round and ’round ’til half-past dawn
There was fifty-seven channels and nothin’ on

Well now home entertainment was my baby’s wish
So I hopped into town for a satellite dish
I tied it to the top of my Japanese car
I came home and I pointed it out into the stars
A message came back from the great beyond
There’s fifty-seven channels and nothin’ on

Well we might’a made some friends with some billionaire
We might’a got all nice and friendly
If we’d made it upstairs
All I got was a note that said “Bye-bye John
Our love is fifty-seven channels and nothin’ on”

So I bought a .44 magnum it was solid steel cast
And in the blessed name of Elvis well I just let it blast
‘Til my TV lay in pieces there at my feet
And they busted me for disturbin’ the almighty peace
Judge said “What you got in your defense son?”
“Fifty-seven channels and nothin’ on”

I can see by your eyes friend you’re just about gone
Fifty-seven channels and nothin’ on…
Fifty-seven channels and nothin’

If you can’t make money, you don’t deserve to survive. I’m sure I read that in a book some place.

If not enough people want you, then it’s not up to everyone else to make sure you make it. Telling me that my outrageous cable bill is important so that others can watch channels I have no interest in watching just makes me more angry, not less. It’s the worst argument you could make to me, the consumer.

Anyone who tells you that anything at all about the cable business, as it is currently constituted, is good or necessary simply has one hand on your wallet and the other on your balls. Because I would be hard pressed to find a more rapacious and useless business out there than a cable company.

Well, maybe the NCAA.

JR: New channels could easily survive as “free samples” that people could get, just as Showtime has one or two days a month free. Except that free samples could be one month at a time, just skipping out out on the biggest, most important episodes to remind you to subscribe for the LOW LOW FEE, or somesuch.

Actually we only watch about six of the cable channels we get and we have an outside antenna that picks up HD on ABC, CBS, NBC, FOX, and three PBS channels. So right now I am paying over 50 dollars for 6 cable channels. Some kind of choice of channels would be nice. Even if it was called Make Up Your Own Tier.

How many people would do a cost/benefit analysis on 150 channels? How would new channels survive? How would this work in dorms, workplaces, and hospitals? How would it be reconciled with the must-carry law? Seems like a hassle.

This argument states that bundled packages bring about more choices for customers to watch and that niche programming would not be able to survive in a-la-carte structure. I think this is false. First, niche channels already have a hard time surviving in a bundled system. For past examples, TNN changed their programming and became Spike TV. G4 went from a technology-oriented channel to a more variety entertainment channel. And it was recently stated that Fox Reality will be changing gears next year and will become a National Geographic channel. Being in a bundled system doesn’t automatically “save” these channels, rather it seems that viewers tend to pay attention to the actual content on the channel and weather or not they want to watch it.

Second, a-la-carte would create a free market system for channel distribution. This means that channel distributors such as ESPN would need to price their channels competitively, based on “demand channel” pricing. I think that ESPN is one of those networks that could charge a premium for their channels and still get a good amount of subscribers. But what about the Lifetime Networks? They would need to price their channels to where they would be desired by subscribers. Perhaps the $2 carriage fee is too high and would need to be dropped down to $1 to increase subscribers. This kind of system would promote competition between different channels and would put more control and economic power into the hands of the consumer.

In this free market, if a channel doesn’t do well and disappears, then it probably wasn’t too desirable in the first place. And the content that was shown on that channel could then be shown on another channel within the channel distributors system. I don’t think that Discovery Networks would be saddened if the Military Channel disappeared, as they could show that type of programming on Discovery Channel (maybe create a Sunday night military block of programming).

Another argument that the industry likes to cite is that prices would not change and would actually increase. But prices already seem to increase every year! When has a cable or satellite provider actually lowered their costs to the customer for the same amount of programming?

Again, a-la-carte would create market pricing. I think this market pricing would equally decrease the value of the TV business model across all parties involved in the pay TV system – advertisers, channel distributors, channel providers, and consumers. This situation would be the most beneficial to consumers because it lowers TV bills. In regards to this site, advertisers would also gain more reliable data and information that would be analyzed to determine the proper advertising rates. This subscriber data could count the actual number of customers that subscribe to that channel, providing more accurate information than the “our channel is available in 10 million households” claims that are currently used.

Ultimately, I don’t think an individual channel a-la-carte system will be accepted by the TV industry. However, I think that a system that offered smaller channel bundles that were tied to channel distributors (think ESPN bundle, NBC Universal bundle, Discovery Networks bundle) could work. This would be a middle-ground that would satisfy all parties. In this system, only the business relationship between the consumers and channel providers would change, hopefully resulting in lower TV bills for consumers. This would also promote the “incidental viewing” of channels that is also cited by the representatives who are against a-la-carte.

In regard to Schmoker’s post (most of which I agree with), while cable companies can find other ways to charge people, they are simply passing along the costs of all the channels they provide. After all, once you have a decoder, it doesn’t cost THAT much more just to unscramble signals – it’s the carriage fees you pay for all the extra digital cable channels. Furniture manufacturers pass the cost of wood along, why would anyone not expect cable to?

Eliminate all the other channels and costs will go down for the consumer.

Or just as good, sell channels in $10 blocks. We could get samples of Fine Living Network every month just like we get samples of Showtime to encourage people to watch the NEW and INTERESTING cable option. Then when people realize they can watch a ten hour marathon of Biggest Loser reruns on Fine Living, they’ll jump at the chance to kick whatever they don’t watch out of their $10 allocation and put Fine Living in. Maybe they’ll make it a full 24 hour block! I don’t mean to poke fun at the show, it is an important public service, but you know what I mean. People will see if they want something another channel has.

I really want A La Carte, or at least the $10 block for a pile of channels.

Bundled channels are like a restaurant menu – you may not like all the offerings, but someone else may like them – the restaurant owner wants to prepare the food and offer it on the menu so everyone can find something to enjoy and frequent his establishment.

My solution for those channels that I never watch is to simply delete them from my everyday program guide. Why make this difficult?

For ex: Several years ago, when I first signed up for roadrunner DVR, it was $5.00/mo. Now, even though they have probably quadrupled their subscribers to that service (so the price should go down), it’s up 100% to $10.00/mo. They can only make that ridiculous change, which goes against every principal of business in a fair market, because people’s only other option is sit and stare at a darkened television.

Having a monopoly is what allows these cable companies to operate in ways that bear no resemblance to any real business. In many case, the cable companies have signed contracts with communities that forbid any other company from operating in the area, which is completley off the hook. They aren’t just operating a de facto monopoly, but a de jure monopoly.

Until that problem gets solved and Cox can compete with TW, and TW can compete with Comcast, and Comcast can compete with Cox–all in the same area–things such as a la carte programming are basically the equivalent of rearranging deck chairs on the Titanic. Cable companies will simply counter being forced to offer a la carte services by restructuring prices to make up the difference. Suddenly, it will cost ten bucks a month for a single popular channel. So, yeah, you might not have to pay for HGTV anymore, but you will have to pay through the fricking nose for TNT or ESPN.

M-O-N-O-P-O-L-Y. That’s the only issue that matters. Resolve that, and suddenly pricing comes down and service goes up. Bingo–cable companies will actually resemble a real business for a change.

http://tvbythenumbers.com/2008/12/31/cost-per-cable-channels-as-a-function-of-ratings/10102

I thought the main question was who was financing whom or, rather, how much hay can be made out of advertising on “never watched” channels.