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Television Media United States

FCC Head Supports Ala Carte Cable 295

Posted by samzenpus
from the a-little-of-this-a-little-of-that dept.
MikeyTheK writes "PC Magazine Reports that Kevin Martin, chairman of the FCC, supports ala carte cable. In a letter to several minority groups on Wednesday, Martin said "While I believe all consumers would benefit from channels being sold in a more a la carte manner, minority consumers, especially those living in Spanish speaking homes, might benefit most of all,". He goes on to argue "Cable companies act as gatekeepers into the programming allowed by the expanded basic cable package, preventing independent content producers from reaching viewers,", citing the example of Black Family Television, which was forced to go online-only because cable operators refused to carry it, even after it reached 16 million homes."
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FCC Head Supports Ala Carte Cable

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  • Translation (Score:5, Insightful)

    by Opportunist (166417) on Thursday August 23, 2007 @06:14PM (#20336561)
    We think we can make a ton more cash by charging for each channel extra. Basically, what we're gonna do is reduce the nominal fee by a good 20 percent, cut channels in half and if you want anything but the propaganda, you'll pay extra.

    We think that the average household will want about 80% of the channels they got today, generating about 120-130% of the revenue of today.
    • by garcia (6573)
      We think we can make a ton more cash by charging for each channel extra. Basically, what we're gonna do is reduce the nominal fee by a good 20 percent, cut channels in half and if you want anything but the propaganda, you'll pay extra.

      Of course they'll make more cash this way. Why wouldn't you be expected to pay more to have a special setup different than everyone else?

      I don't see what the necessity for cable/satellite is anyway. My wife is obsessed with TV and that's the only reason we have it in the hou
      • by Anonymous Coward on Thursday August 23, 2007 @06:59PM (#20337181)
        Sounds like you need a better wife.
      • Re:Translation (Score:4, Insightful)

        by bakana (918482) on Thursday August 23, 2007 @11:00PM (#20339429)
        Actually the reason we would have to pay more is because the stations that had guaranteed viewers will no longer be able to project how many viewers will view their channel. Which in turn means they can't support charging as much as they do for advertising time, so they'll want to collect the revenue from the cable provider which in turn would then pass the higher charges on to the consumer. A la carte viewing is not what most people would want, they bitch and whine about today's prices, imagine easily paying 300% more for far fewer channels. People really don't think before requesting things. There is some proposal to have the customer's credited the value for the missing channels against the current price of standard service, problem being that the price for standard would sky rocket because stations like BET, MTV, etc etc would charge the cable company more as mentioned above.
    • Re: (Score:3, Interesting)

      by ystar (898731)
      Naturally, but this might also point to cable companies' desire to stop pushing everything over coaxial at once and move towards a TV over IP system. It's probably cheaper to gain bandwidth by pushing out new cable boxes to everyone than digging and laying new lines. For my parents, who only want one or two international channels, this would probably be a good move.

      I hope that it cuts down on the number of folks around the country watching crappy tv once they have to shell out cash for it specifically. If m
      • You know, just because you don't like it, doesn't mean that it should go away. I consider absolutely nothing on TV to be quality entertainment. The shows I like, I own on DVD (Futurama, TNG, DS9, etc). Once Voyager stopped producing new episodes, my interest in TV ceased--but you'd probably be pretty irritated if all TV went away just because I don't care for it.
      • Re: (Score:3, Informative)

        by cadfael (103180)
        Nope. They like coax. They spent a lot of money putting it out there, and that is why you are seeing things like SDV and Digital Simulcast coming out (lets them harvest RF bandwidth) to deliver more over the coax. It is UNBELIEVABLY expensive to re-run lines to each house in the areas they serve (Verizon is spending billions doing it with fiber), so get used to coax.

        Video over IP is possible in coax. You use a DOCSIS channel to encapsulate IP packets that encapsulate compressed audio and video. Video over I
    • Re:Translation (Score:5, Informative)

      by Dynedain (141758) <slashdot2@a n t h o n y m c l i n.com> on Thursday August 23, 2007 @06:57PM (#20337147) Homepage
      Yes, they'll make more... from the standpoint of lowering prices can induce more purchasing.

      Take my situation for example:

      I can spend $40/month for basic cable, which only gets me my already free over-the-air channels, 10 local public access channels, and 2 or 3 nation-wide basic cable channels (like WGN, CSPAN, and TNT).

      I don't watch any of those additional channels, so what's the point?

      In order to get the 3 or 4 extra channels I do want (Cartoon Network, Disney, Food, SciFi) I need to buy a $60/month package that gets me an extra 15-20 channels that I don't care for, simply because of how the pricing tiers are structured.

      I would be more than willing to buy those 3-4 channels ala carte. I would pay $10/month for those channels as they are things I want to watch that I cannot get over the air. I am not going to pay $60/month (plus fees) to get those channels.

      So, the cable company would get another customer, and make more money, by simply offering ala carte programming. I doubt I am the only person in a similar situation.

      Alternatives? Satellite, but as a renter, I'm limited in what I can attach to the building, or buying programs individually on iTunes. Other than that, I don't have any legal options, so I just go without.

      The same logic is used for music sales. Price an album at $16 and 10 people buy it, garnering you $160 in sales. Make the songs individually available for $1 and 200 people buy individual songs, garnering $200 in sales, simply by putting things in a different pricing scheme. Similarly, it's been noticed that people are more willing to spend $25/month on individual songs, than to spend $40 every 2 months on full albumns.
      • by dgatwood (11270)

        I can spend $40/month for basic cable, which only gets me my already free over-the-air channels, 10 local public access channels, and 2 or 3 nation-wide basic cable channels (like WGN, CSPAN, and TNT).

        Wow. That's what I spend for a couple hundred channels from DirecTV. Of course, that's for one set, plus $5 per extra set, but still, that's bordering on insane.... I get basic cable with about your stated level of service for free where I live. Find yourself a better cable provider. Seriously, when

      • by jcdick1 (254644) *
        Call me cynical, but I can't imagine that they would price individual channels that low. I can see $10 per channel per month, but you aren't going to get them for $2.50 each. No way.

        A la carte cable channels will pretty much destroy the new standard in quality that a lot of people see happening on channels like F/X and TNT. The revenue sharing that goes on - subscribers pay a flat fee, and TNT gets a chunk of every subscriber on every cable system that carries it, whether you watch or not - allows them t
        • by hedwards (940851)
          That is possible, but on the other hand, it could also make networks more competitive. Networks that don't show programming that people value would largely disappear.

          I probably only watch a small handful of nonlocal channels in a given month. Most of the 130 or so channels that I have available don't get watched. I like that the selection is big enough that I can usually find something good, and if not I usually have something recorded.

          Meanwhile, some networks should pay me to have them on my plan. Home sho
      • by numatrix (242325)

        You're getting killed on that price! I pay $12 a month for 20 channels that sounds the same thing! Incidentally, it's with Cox Cable, and it was originally $10 when I first signed up, though the price has gone up slightly. Here's what their website says:

        Cox Standard Cable = Cox Limited* + Cox Expanded Cox Limited* - Some areas call this service Cox Basic. Includes access to all of your local channels. Cox Expanded Includes an additional range of cable networks featuring ESPN, Travel Channel, Discovery Channel, Cartoon Network and so much more. Cox Expanded service is only available with Cox Limited service. Standard Cable is also referred to as Complete Basic Cable, or Cox Classic Cable in some areas. PLEASE NOTE: If you have Limited Cable only, you must upgrade to Cox Standard Cable when purchasing the service online. If you have only Limited Cable, please check the box marked "None" to see the savings and total monthly charges for the Cox Connection.

        Really interesting how you basically can't upgrade your account at all from that plan via the website. Hey, at least I pay 25% of what I could be from the sound of it!

      • by CDarklock (869868)
        There's another effect here.

        Certain channels may not really have much of an audience. If you bundle such a channel with a channel that does have an audience, some of that audience may discover the otherwise uninteresting channel.

        This is basically a way to defray the massive cost of introducing a new channel. Those of us who like reasonably obscure channels greatly prefer a bundled-pricing scheme where the twenty people in the state who watch the "Classic Disco" channel can do so because they're getting a sh
      • by Rudolf (43885)

        I can spend $40/month for basic cable, which only gets me my already free over-the-air channels, 10 local public access channels, and 2 or 3 nation-wide basic cable channels (like WGN, CSPAN, and TNT).

        I don't watch any of those additional channels, so what's the point?


        If everything you watch is available OTA, then why do you subscribe to cable TV?
    • Well, they certainly could make more money off of me. Right now they get $0, whereas I'd be willing to pay $20-25 for 10-20 channels that I picked. Heck, I might even be able to convince my husband for that price, and he doesn't like TV. But I'm not willing to pay $50 for those plus another 80 I don't want.
      • Those 10-12 channels would probably cost the same 50 bucks they cost today. The calculation is simple and already happened here.

        Old model: 50 bucks for about 70 channels.

        New model: 30 bucks for about 40 channels. Of those 40 channels, 30 are such important services as home shopping, previews for movies on channels you have to pay extra, weather channel, call-in-and-win channels, reruns of old game shows, court TV, faux news and other crap. They might contain 1-2 channels that you want.

        The "good" programs (r
  • by twocoasttb (601290) on Thursday August 23, 2007 @06:17PM (#20336597)
    Spike TV and one 'o them 'God' channels. Just to keep some balance.
    • Spike TV and one 'o them 'God' channels. Just to keep some balance.

      Speaking of 'God' channels, John Safran vs. God [johnsafran.com] is quite good. Was that what you were thinking of?

      Personally, I'm interested in more worldly matters. I have an extended cable subscription, but my regular viewing is limited to PBS (news and entertainment), C-SPAN and an occasional Dog Whisperer episode. My sojourns onto other channels mostly serve to remind me how much crap is out there, how often that same crap is repeated, and how much I
  • by Bomarc (306716) on Thursday August 23, 2007 @06:17PM (#20336601) Homepage
    Why do I need to pay for others to have 50 sport channels? The SciFi (et al) channel works just fine for me, I don't want to have ESPN; which by talking to the cable companies is one of the most expenive "free" channels out there.
    • by toejam13 (958243) on Thursday August 23, 2007 @06:54PM (#20337107)
      Agreed.

      ESPN is a shining example of why bundled packages don't work. ESPN is one of the most expensive channels for cable and sat companies to offer. This is, in part, due to the huge costs associated with the acquisition of broadcasting rights for various sporting events by ESPN.

      It is compounded by ESPN's growth model, which is to spawn more specialized sporting channels that they then shuffle semi-major sporting events to. This was done with ESPN-2 and is now being done with ESPN-U. (see here [scout.com]) So if I want more of the specialized channels *I* want, I end up paying more for ESPN channels I could care less about.

      The icing on the cake is this - about seven years ago, I paid over $600 for an ATSC/DVB-S receiver in order to pick up HD stations. The sat provider that I went with offered several HD channels for free. Several more channels were added to the HD package over the years, but the cost remained the same. This continued until ESPN-HD arrived. Suddenly, I was asked to pay a small fee to continue to watch all of these channels.

      I subscribed to it for a while, but why? Most of the programming on ESPN-HD was simply upconvered NTSC analog programming. So I dumped it. Kept my sat service for a few more months then dumped it completely. Now all I get are local channels, TBS, WGN and Discovery that come free with my cable company's digital cable package.

      Both my cable co and my former sat company bombard me with offers for HD PVRs and several months of free service. Why? All of it except for one or two channels is nothing but junk to me. The only way for me to pick and choose is to get a C-band sat, which my HOA would never approve.

      So in the end, this cartoon [photobucket.com] from the CSMonitor sums it all up...
      • Re: (Score:3, Informative)

        by evilviper (135110)

        The only way for me to pick and choose is to get a C-band sat, which my HOA would never approve.

        Not sure about C-band but your HOA absolutely positively CAN'T prevent you from installing a smaller KU band dish (thanks to recent federal regulations) and it seems most content has moved to KU-band over the past few years, anyhow.
  • by ral315 (741081) on Thursday August 23, 2007 @06:21PM (#20336655)
    The problem with a-la-carte pricing is that it makes it impossible for new networks to get enough subscribers to start up. Think about it - how many of us would personally watch LOGO, the Gay/Lesbian Network? Some, but not enough for it to survive without charging an insane amount per subscriber. How about a network like the old TechTV, or even G4? Most of us would, but most consumers wouldn't. Even networks that would appeal to everyone would have a tough time gaining ground once it went into effect. Would you call in to purchase a new network? Not unless it had a show you really, really wanted. You can make an argument that it should be based on who wants each network, and that you shouldn't pay for networks you won't watch, but I'd argue that package programming keeps the price down for all networks.
    • Re: (Score:2, Insightful)

      by bagboy (630125)
      Ummm... Thats called competition... If it can't survive.. it can't survive. Consumers should not be forced to subsidize programming that cannot survive on its own - it's called capitalism.... not socialism....
    • Re: (Score:2, Insightful)

      What you describe is not a problem. It is a solution. Why should channels that struggle to attract viewers remain afloat in a competitive system ?
    • They could offer their channel for free one or two months until they've got a good subscriber base. It would create a higher entry barrier, but definitely not insurmountable.
    • by dave1g (680091)
      you can start your tv network online for cheap using youtube or bittorrent.

      www.purepwnage.com for a good example of making money with small time budget. imagine what a company with more diverse programming could do. once they have proven themselves they have more clout with a cable operators. and they could be offered on cable simultaneously. the marginal cost of adding a channel must eb extremely low for a cable operator, they might as well offer it for a few bucks a month to those that want it.

      Also with a
    • Re: (Score:3, Insightful)

      by evilviper (135110)

      The problem with a-la-carte pricing is that it makes it impossible for new networks to get enough subscribers to start up.

      Nope, EXACTLY the opposite.

      It's MUCH easier to convince individuals to pay a couple dollars a month for a new channel than it is to convince a big cable company to pay hundreds of thousands of dollars to be allowed to carry a new channel that there's no guarantee their viewers will want to watch.

      The only exception is spin-offs from already-big cable networks... If Viacom starts up anoth

    • Re: (Score:3, Insightful)

      by xenocide2 (231786)
      Why not just give the channel away for free then? The whole point is to mass viewers for ad sales and ratings. I'm not an economist, but it seems to me that charging acts as a tax on viewership. You lose viewers, viewers lose content, and ad men lose whatever demographic you could have captured. Of course, you gain a small amount of money for charging, so this might not be a correct statement.
  • by fireboy1919 (257783) <rustyp@NOsPAM.freeshell.org> on Thursday August 23, 2007 @06:22PM (#20336663) Homepage Journal
    Television is still mostly paid for by commercials. Any channel not generating much viewership isn't generating much sales. Either that, or the target audience doesn't buy things as much.

    Either way, a la carte would end up looking exactly the same...except probably with less variety, since channels that are currently not competing would start.

    Of course, I'm with the majority, so it'd be great for me. USA, Cartoon Network, Sci-Fi Channel, and Comedy Central are my channels, and I know that they're all pretty popular. Then again...I wonder what's more popular. It could lead to more of that reality-tv crap infesting my channels. There are already full channels that run nothing else.
    • Re: (Score:3, Interesting)

      by Dracos (107777)

      In a way, it would.

      There are so many worthless niche channels out there that skate by because everyone pays for them, but no one watches them. Who in their right mind would specifically subscribe to the Game Show Channel, the Reality TV channel, or any home shopping channel?

      Plus, it might have added benefits:

      • Putting G4 out of its misery
      • Teaching SciFi a lesson about canceling all their good series.

      Seasonal subscriptions (ie, I would only want FX when Rescue ME is on) would probably throw cable into u

      • > Who in their right mind would specifically subscribe to the
        > Game Show Channel, the Reality TV channel, or any home shopping channel?

        My Mom for one. She watches the Game Show Channel religiously. Last I checked she was in her right mind.

        jfs

        • Ah, you are mistaken. You checked if she was in her right mind (is she watching the Game Show Channel?), and she was found to not be in her right mind (wtf, she is watching it!). ;)
      • by Qzukk (229616)
        would probably throw cable into utter chaos

        It could be easy to implement, just a bitmap that comes down the wire telling the system what channels it is allowed to show. Customer wants to change... call in on a touchtone phone, enter their subscriber number (or use caller ID and a PIN?), select their changes and receive a new bitmap.

        Of course, the real problem isn't that there will be "chaos", the real problem is that people will subscribe to the channel they're watching for the duration of the show, then t
    • by ImaLamer (260199)
      The fact there are commercials on all of these cable channels makes me irritated that I even have to pay extra for them. Even if you wanted basic cable in my city (USA, MTV, Comedy Central, SCI-FI, etc) you have to pay > $50 because they have a contract with the city that demands it. Essentially the city has given them this monopoly that provides this service (broadcast) that provides commercial subsidized programing. Isn't that wrong?

      Does it even make sense to pay for what should be free TV? Over the in
  • by TechwoIf (1004763) on Thursday August 23, 2007 @06:25PM (#20336707) Homepage
    The programmers, like Viacom, force cable companies to carry channels they don't want and therefore forced into package deals of today. Remember the brewhaha a few years ago between a satellite provider and programmer, that resulted a crawl text to all subscribers that there faverate channels may be dropped before they came to a deal.
    • That's the wonders of having a federal agency. If they're not corrupt, they can actually do things for the benefit of the people.

      On a related note, there's an old story on PBS [pbs.org] about a Canadian who became his own cable company. FTFA:

      With the exception of local channels, which come from an antenna, all of Andrew's video content comes from a C-band (big dish) satellite receiver (receivers, actually), and is fully paid for. "I buy the channels just like a cable system does or a motel that wants to offer HBO, from the National Programming Service," says Andrew. "And as a result I pay wholesale prices. People don't realize how much of a markup there in is the cable business. The Discovery Networks, for example, cost me $0.26 per customer per month. The IP laws in both the U.S. and Canada say that if I have legal access to this content I can store and use it. And the over-the-air channels, of course, are free."

      Imagine of the FCC allowed people to be their own cable companies. At $.26 per channel per household, that's a hell of a steal. And that's also how you can see how much cable companies and DirectTV mark up their prices (don't forget, they also get advertising revenues.)

  • Sports Networks (Score:2, Informative)

    by M0bius (26596)
    I actually believe the cable companies would like to offer ala cart pricing. The problem is that the sports networks dictate that if they aren't included with every customer, they won't offer service at all. All or nothing. They also charge a ridiculous percentage of the total cable bill per month. Extortionists, it seems.
    • by eln (21727) *
      I think the average consumer needs 187 combined hours of Sportscenter each day. And how could we call ourselves a civilized nation if we couldn't watch the Underwater Basket-weaving Finals on ESPN 8 "The Ocho" in prime time?
  • Companies like BFT that can't get cable traction, should try deals with alternate routes like Live or ITMS. I don't even see why we really need streamed video much anymore, except for truly live stuff - which we can get from over the air broadcasts.

    Even news programs I would be just as happy to subscribe to a feed for and get a download that I could watch when I had time.

    Having a subscription model also allows for video to be distributed via BitTorrent, really the only model that makes much sense for HD vi
    • by dosius (230542)
      The tech's definitely out there. A friend and I have been experimenting with a system to stream a 640x480, full framerate, stereo video feed over RTSP on his friend's gigabit pipe, and so far, it's looking up!

      The simple matter of programming, now, is the showstopper we're working on now.

      -uso.
    • Companies like BFT that can't get cable traction, should try deals with alternate routes like Live or ITMS.

      Which is what's going to happen. And which is why you're hearing about this now, because it's too late. All the niche content will move to internet distribution, whereas TV will remain the bastion for the big networks, news, and other live events. (Maybe we'll get lucky and eventually get a Star Trek channel. Between all the series, movies, specials and whatnot, there's enough Star Trek materia
      • Which is what's going to happen. And which is why you're hearing about this now, because it's too late. All the niche content will move to internet distribution, whereas TV will remain the bastion for the big networks, news, and other live events. (Maybe we'll get lucky and eventually get a Star Trek channel. Between all the series, movies, specials and whatnot, there's enough Star Trek material to fill a whole channel.)

        Wait, you mean spike isn't the star trek channel?
  • Good. (Score:2, Interesting)

    by darnoKonrad (1123209)
    I've never ordered cable or satellite because there are only a half dozen channels I care about. I'll take the 6 channels I like and they can charge me 6 bucks a month. For an extra dollar I'll take the university channels. If they want to charge more, well I will continue to abstain from purchasing their product.

    Since I've upgraded to Digital TV OTA, I now get a music video channel, and 8 PBS channels -- amongst the others. I could care less about cable unless they want to give me the product I want to
    • And what of infrastructure costs? A digital cable box might cost $200 and then you need to factor in depreciation. The cable company has to run wire down your street, from the pole to your house, etc. They have to maintain those wires. They need to maintain their broadcasting equipment. They need to handle billing and technical support. It probably costs $10-15 a month per subscriber just to maintain the network (and I've seen estimates for Dish Network's per customer fixed costs being around $28/month)...
  • Allowing people to subscribe to channels on an ala carte basis may actually improve programming. There are so many channels that are full of unmitigated trash, but get "sold" because they are bundled with channels that have a couple of good programs. Those channels would need to start doing some actual programming, or they will find themselves losing what advertisers they do have.
  • Sounds great (Score:3, Insightful)

    by SydShamino (547793) on Thursday August 23, 2007 @06:27PM (#20336741)
    I'd be happy to pay $1 per month per channel. I'd probably end up getting half as many channels as I do now while paying the same amount, but they'd be the [i]correct[/i] channels. I'd drop 30 channels I never watch and add 2 that I would.

    Or, if they want to price the channels competitively, I'd be willing to work with that, too. I'll pay $4 per month for ESPN if it's so expensive, but I'm going to pick it up each August and drop it each January so I can just get college football. At $1/month for ESPN I wouldn't bother.

    This doesn't make it hard for new channels to break in, either. Dish Network is always having "free preview weekends" for higher-tier cable and premium content. If you want to launch a new cable channel and get people interested, you might have to (*gasp*) give it away for free and rely only on your advertisement income or your startup capital before you gather a critical mass of viewers. Then, you can add a low monthly fee, and scale it up as your popularity continues to climb. Sounds fair to me.
  • by immcintosh (1089551) <slashdot@nOSPam.ianmcintosh.org> on Thursday August 23, 2007 @06:35PM (#20336869) Homepage
    It's "a la carte," meaning "by the menu."
    • I think in the case of cable TV, "a la cart" is more apt.
    • Technically, it means 'of the card.' In French, menu means a set menu; a la carte refers to things that are not on the set menu. In English, 'menu' is used to refer to both concepts, menu and carte. Carte has a number of meanings, including card, menu, and map.
  • by pabster (875594)
    This is all BS and anyone with half a brain knows it. Cable monopolies are not interested in providing consumer choice. If such an "A-La-Carte" system were ever put in place, you'd get 5 channels a month for $60 instead of 200. Sure, they'd be the 5 you want, but would YOU pay $60 for just those lousy 5 channels? They'll kill this idea just like CableCARD...Speaking of, how is that going these days?
  • by ReTay (164994) on Thursday August 23, 2007 @06:44PM (#20336983)
    1. The content producers (TV networks) decide what they want to put on and tell the cable companies that it is a take it or leave it deal. If the cable companies puts up a fight they put a scroll in that says Your cable company does not want this channel call them to change their minds on the highest rated shows. They try to force high cost programming in to the lower tiers so everyone that has those tiers has to pay for it. The golf channel did this just before the US Open. It did not work. They are on a high tier package.
    2. The cable provider will calculate what the cost to maintain the connection (and some profit and that will be broken out on your bill. Then each channel will be listed.
    3. The number of channels will go down. Right now some networks run lower cost channels in the higher tier and subsidize it with a more popular channel. With out that subsidy there would never have been a History Channel for example.
    4. The content providers will not let this go through, not the cable companies.
  • I don't see why it would have to be all or nothing pay-per-channel or pay-for-3-million-channels. Why not a base rate that everyone pays for their basic cable plus a per channel rate to add any number more channels? Right now I have the option of getting basic cable, which lacks ESPN and the NFL Network (yes, I'm one of those people who requires them, folks), Comedy Central, and the Sci Fi Channel, or paying an arm and a leg for a whole slew of channels I really don't care about.

    While I realize that this
    • I *need* FSN West... At least between April and October. That's where 90% of the Angels games are on.

      Go Halos!
      • by shalla (642644)
        Well, the NFL Network would just be for the Thursday night games that they won't show anywhere else, and I figure I'll shake down my brother and my ex-husband for part of the cost. I mean, really only one of us would have to get it to see the games, and we tend to watch them together when they're worth watching.

        ESPN (and possibly ESPN2) I'd get for the other sports too, but football is the most consuming. Baseball and hockey are also great. I've learned to appreciate tennis, Aussie Rules football, soccer
  • My order (Score:4, Funny)

    by planckscale (579258) on Thursday August 23, 2007 @06:51PM (#20337075) Journal
    Hi, what can I get for you today?

    Yes, thank you, I'd like your High Speed Internet Access.

    Ok, no problem, the half order or full size?

    Full size; the one with 3mb/s down 712 up.

    Do you need hardware or setup?

    Nope.

    Sure no problem, anything else?

    Yes, I'd also like a few side orders?

    Ok go ahead.

    The local channel 17, Discovery Channel, Animal Planet, History Channel, Military Channel and AMC.

    Anything else?

    How much is your ESPN package?

    4.95 per month.

    No thanks

    Would you like to try our HBO package? It's free for the first 3 months.

    No thanks

    Okay that's a Full size order of high speed internet for 19.95, plus 6 sides at .95 cents a piece. Anything else?

    Nope that will do it for now.

    Including taxes, fees and internet monitor labor, your total is $76.65.

    WTF?!?!

  • by teebob21 (947095) on Thursday August 23, 2007 @07:07PM (#20337255) Journal
    I work in the billing department at a smaller cable company, so maybe this post is biased. At least it's biased in the direction of truth, rather than ranting consumer speculation. I also used to work as a field technician for the same company, so I am in a position to know this issue.

    First, most cable and satellite companies would be contractually prohibited from complying with any such mandate from the FCC, if it were to be announced tomorrow. Viacom, HBO, Universal, Disney and the over-the-air corporations demand carriage of their lesser-known networks in exchange for a reduced rate on their main programming. For example, our customers demand - and we willingly pay - for ESPN and ESPN HD. The cost per subscriber per month is about $14. We also carry ESPN2, at a discount. If we dropped ESPN 2 from our expanded basic tier, the SD and HD ESPN channels would cost us $9/mo per sub. We are currently in month 4 of a 36 month contract at this rate. Thus, we cannot break this portion of the bundling in our lineup for the better part of 3 years.

    Additionally, it is a simple fact that forced a la carte offerings would lead to higher customer cost, and reduced quality. Most cable companies continue to carry their basic tier in analog. A la carte analog results in a daisy chain of traps at the pole or pedestal, degrading the signal across the spectrum. A la carte digital requires equipment in customer's homes with remotely accessible security. You can achieve this with CableCards or Switched Digital. The two are not currently compatible, so it's an either-or situation. In all honesty, MY employer wants CableCards to work correctly. When they don't, it generates higher costs in the form of truck rolls, and lower customer satisfaction.

    This is to say nothing of the increased cost due to the creation of rate codes in the billing software for each channel, and the corresponding training of 1700 CSSR's on how to use them. It also ignores the time/cost of converting 79,000 video subscribers to an a la carte plan, so on and so forth.

    Kevin Martin has a lot of dreams, most of which seem to be based in fantasyland regarding cable companies. I would be happy to have him shadow me for a week to see how these companies actually operate, so he can realize the true costs of what he dreams up.
    • Couple of honest questions here.

      Consensus is cable cards simply don't work and a newer spec promoted by the cable industry is on the way. True? I thought cable cards were required to be supported after a certain date, but I don't know. Would that solve the a la carte technical issue?

      What would it take to drop analog cable? I haven't heard of any mandate, but a decade ago I heard cable companies wanted digital to more closely monitor usage and have more remote control. Is there a reason the rollout is so slo
      • by teebob21 (947095) on Thursday August 23, 2007 @08:43PM (#20338275) Journal
        And a couple of honest answers:

        I've posted about CableCards before, and yes they DO work...when they work. When each piece of the system is compatible, CableCards work great. We have verified that our Motorola DAC will talk to our CableCards via our billing system, in a host with compatible firmware. Unfortunately, the host is the customer's TV/Tivo from any number of manufacturers. When their firmware is incompatible, or the proprietary guide doesn't populate, the cable co gets blamed for these problems. We do our best to solve many of these situations, even though they are not our responsibility. The original 1.0 revision of CableCards was capable of two-way communication, but Consumer Electronics companies decided not to utilize this capability. Link: http://www.opencable.com/primer/cablecard_primer.h tml [opencable.com] The older cards were single-stream cards, meaning they could tune a single channel at once. The newer revision which are preinstalled in our Motorola DCH's are M-Cards, capable of decoding multiple digital streams at once. Unfortunately for the consumers, CE manufacturers continue to build TV's that lack a diplex filter and other parts necessary for integrated 2-way functionality.

        To drop analog cable would requires a digital tuner in or behind every TV in every home for our subscribers. We could go all-digital in a very short time, effectively eliminating ourselves as a competitor for those who can not purchase a new TV. We are currently working with Motorola to create a "dongle" style digital converter. The "mini-box" would be capable of being authorized on a channel-by-channel basis, using the removable security (CableCARD) currently mandated by the FCC, and still provide compatibility with older analog TVs. If we could get such a product for less than $100 cost per unit, we would order 20,000 of them tomorrow.

        A la carte depends on all-digital, and it is technically feasible. There is a reason DISH Network advertises their content as all digital...on transmission it is, but once you hook up your sexy Dish HDDVR via regular coax and tune to CH 3 to watch, you're back on analog. However, the upfront AND longterm cost for cable companies to do so AND offer a la carte will be quite high, and like ANY business, cable companies will pass the increased cost to consumers. Additionally, contracts will need changed, something that will move at the speed of a jellyfish in January.
        • Re: (Score:3, Insightful)

          by Dausha (546002)
          I would be willing to pay more if I could pick which channels made the money. I don't like knowing that a bit of my money goes to support a channel whose values I despise.

          Also, ala carte does not necessarily mean that there be _no_ bundling. It gives users a choice to be bundled or not. You cable companies can continue to offer a "basic tier" at the lower price and let people decide if they want to pay the same amount for four channels instead of 40. It also ensures a certain number of subscribers still bun
    • Re: (Score:2, Insightful)

      by Moonchen (452105)
      From your analysis of ESPN, it seems like you're saying that with a la carte cable, the customer would be able to pay $9 for ESPN if they did not want ESPN 2. To me, that is exactly the appeal of a la carte cable. I'm not expecting to pay 3/40th for three of the channels in a 40 channel bundle, but rather something less than 100%. It would be cheaper, and I don't lose anything because the other 37 channels are just noise to me.

      Also, the other part of your argument sounds like you're saying that the cost
    • don't argue to us about analog! that's going away VERY very shortly.

      also don't argue about YOUR need to 'trap out' content at the pole. again, that's your old ancient business model that should not even apply in the digital world anymore.

      you also argue about -current- contracts and how they force you, the cableco, to have to carry B if you want A.

      if the rules change then these contracts will change next cycle.

      stop arguing FOR bundling. its a stoopid idea and its about time that we FINALLY de-bundle progr
    • by aero6dof (415422)
      For example, our customers demand - and we willingly pay - for ESPN and ESPN HD. The cost per subscriber per month is about $14. We also carry ESPN2, at a discount. If we dropped ESPN 2 from our expanded basic tier, the SD and HD ESPN channels would cost us $9/mo per sub.

      I pay my sat network ~$35/mo for my access so if they're playing about the same all the other channels cost about $21. I couldn't care less about sports and maybe 10% of all households are the same. There are definitely other channels for w
  • Every year we have to watch as SlashDot continues to be ignored for being "too black".
  • I would support Ala Carte cable. It'd love it. That said, I figured I should provide a little perspective.

    I was reading the previous issue of Forbes a day or to ago (not the current one the one before that) and they had a story about the guy behind High School Musical and how Disney has made their channel much more popular than it used to be (at the expense of quality and watchability, in my opinion).

    The article mentioned that Disney is the 4th or 5th most expensive cable channel, and costs 89 cents per s

    • by MBCook (132727)
      Sorry to reply to myself, but that's 89 centers per subscriber per month. Forgot that last part.
  • I wish more channels would offer their best ala carte programming online. Let them have their commercials there. Make a good experience for the viewer and they will go for it. Cut out the middle man altogether (unless of course, your cable company owns the internet access too... ;)
  • First, a la carte channel pricing.

    Next step, a la carte showpricing.

    Eventually, what's available today on iTunes (or illegally on YouTube or via bittorrent) will be the only way business is done. It's only a question of how long it'll take, and how much it'll cost.

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