mediacrit.com

If you are like most Americans, you have 60+plus cable television channels, but as you zip through the line-up, you only stop to watch about 17 of them regularly, according to Nielsen Media Research. Consider the price of your monthly cable bill, and you might be asking yourself, why am I paying for the two-thirds or more channels I never watch?

Up until now, the answer to that question has been technological. But now with the increasing availability of digital cable service with set-top boxes, cable systems can have the technical capability to offer cable channels a la carte – that is, a system where you pick and subscribe to only the channels you want.

Representatives from the Washington, D.C.-based group Consumers Union (the people who publish Consumer Reports magazine) testified in favor of a la carte cable to the Senate Commerce Committee two weeks ago. They argued it would “give consumers the right to eliminate programming that they don’t want to receive or pay for.”

A large part of your monthly cable bill is due to the cost of the channels carried in basic cable packages. Cable programming providers (such as A&E, CNN, or Comedy Central) charge cable system operators (such as Mediacom or Cedar Falls Utilities) a fee for each subscriber. Some channels can be free – such as the Home Shopping Network, which is essentially one nonstop commercial. Most channels charge roughly between 30 cents and $1. But, a few channels, mostly sports channels, charge $2 to $3 or more per subscriber. ESPN is most notorious among cable companies, as it has increased it per-subscriber fee more than 20 percent for each of the last five years.

ESPN, of course, has big programming costs for the contracts it signs to carry sports league games and events. But ESPN is clearly doing more than covering its costs, since it makes an estimated $1 billion each year for Disney, its corporate parent. That’s leading many cable companies to complain that ESPN is gouging their customers, since those cost increases are typically passed along in the form of higher cable bills. As Commerce Committee Chairman Sen. John McCain noted, cable rates have risen 56 percent since 1996, nearly three times the rate of inflation.

Interestingly, though, most cable companies and channels aren’t interested in rolling out a la carte cable for their customers. Commercial cable companies argue that it will result in fewer program choices and higher prices. In other words, they say that some channels included in basic packages, such as Discovery or TLC (The Learning Channel) won’t have enough viewers to sustain them as stand-alones, whereas others might raise their prices to cover the costs of fewer subscribers. By subscribing to fewer channels, viewers might also miss the occasional serendipity of actually finding something interesting to watch on one of the cable channels usually passed over.

But, an a la carte system of choice could also mean that marginal channels, such as Free Speech TV (currently only available on DirecTV), BBC America, and Noggin could reach wider audiences. Moreover, as the Senate Commerce Committee argued, a la carte doesn’t mean that cable companies couldn’t also still offer their tier packages, or perhaps even mini-tiers—imagine optional packages featuring all sports or all music video, or all children’s channels.

Perhaps the most compelling testimony came from Gene Kimmelman of the Consumers Union, who noted that “In Canada you can get, from at least three major cable operators and a number of small ones, a digital package that’s a basic package and you can pick five or 10 of your favorite channels for about 30 percent less than what cable operators offer their digital customers in the United States.”

Right now, a la carte cable TV is still in the discussion stage. Although municipal cable companies like Cedar Falls Utilities and Independence Light & Power, which have a public mission to work on the behalf of their communities, would likely offer a la carte if local citizens demanded it, it would take an act of Congress to force the adoption of a la carte by the nation’s commercial cable operators and programmers, who are doing quite well with the current system.