A la Carte?

[Greg Bimson]

Government intervention to require a la carte as an option and prohibit "all or nothing packages" from the content providers would allow a la carte as a viable, low cost option to the consumer.

So what you are in essence saying is that Disney cannot package ESPN in one agreement, Disney channels in another, and ABC Family by itself, but you'll allow the cable and satellite companies to package channels as they see fit?

Or, in other words, the free market has worked well for the past couple of decades but we need government intervention into the free market to promote the free market? All kidding aside, consumers (by definition, those who consume) have the right to walk away if they don't like any of the choices they are given.

I also seem to recall there was a suit filed somewhere by someone that took the big distributors and the big programming conglomerates to court and are basically asking the court to find them in violation of anti-trust laws. Seems to me it may be a good idea in principle, but that only has a snowball's chance.

It's really the content providers that are driving the constantly increasing cost of pay TV.

But the distributors also keep a portion of that rate increase. You honestly can't believe that a $4 rate increase is because the distributor has to pay programmers $4 a month.

I recall that Dish Network raised their DVR rates back in February. Those rate increases would go directly into Dish Network's bottom line.

I sure irks me to endure a rate increase so Disney or CBS can force feed a bunch channels that have daily average audiences that seldom exceed 4 digits.

But then again, Dish Network sued Disney to have 4 HD channels be provided for free under an existing contract using some tortured definitions, and instead the court awarded Disney $65 million in interest for failing to pay Disney on time for other properties.

So a good chunk of rate increases could be due to the failure of negotiating carefully and the misguided attempt of litigating everything, no?

 

[Hall]

Now with Dish I have to get their 250 channels just to see 4 or 5 channels I want.

There will ALWAYS be someone who wants "4 or 5 channels" that are in a higher package than they have and it ain't gonna be the same 4-5 channels ! In this scenario, the providers can't win -- they can't provide packages that please everyone. Consumer-friendly 'a la carte' would be "AT120 - $29.99/mo - you the customer select your favorite 120 channels !", for example (I don't know what AT120 costs, that number is just an example).

 

[falkor]

I never wrote it no longer works . I tried to explain what MOST here already know . That is , why we do not have that option anymore . Do you enjoy playing Devil's Advocate or are you just naturally rude ? Do not answer that because I will not see it now

 

[falkor]

Government intervention to require a la carte as an option and prohibit "all or nothing packages" from the content providers would allow a la carte as a viable, low cost option to the consumer. However, revenue and profits for the content and service providers would drop substantially so their lobbyists will never let this happen. Government serves the big business lobbyists, not the American consumer.

It's really the content providers that are driving the constantly increasing cost of pay TV. I sure irks me to endure a rate increase so Disney or CBS can force feed a bunch channels that have daily average audiences that seldom exceed 4 digits.

Agreed !!

 

[Greg Bimson]

I never wrote it no longer works . I tried to explain what MOST here already know . That is , why we do not have that option anymore . Do you enjoy playing Devil's Advocate or are you just naturally rude ? Do not answer that because I will not see it now

Ah, but the response is necessary.

I'm trying to make people think; most might not know why we no longer have the a la carte option on C-band.

C-band failed, for a variety of reasons. Competition from other providers is amongst one of those reasons. And if a la carte was that important, C-band would still be alive today!

Then again, Mr. Ergen was a C-band dealer. He started Dish Network because he saw the writing on the wall; the wave of the future was cable-in-the-sky from a pizza dish.

I did not mean to come across as rude.

 

[Hall]

Do not answer that because I will not see it now

But others will

I think it's funny how people don't like the answers they get or their ideas get shot full of holes respond.

 

[Hall]

C-band failed, for a variety of reasons. Competition from other providers is amongst one of those reasons.

I'll bet a) having to pay for the equipment and b) 10' dishes were a far bigger factor in C-Band's failure.

I think it's funny seeing some of those BUDs still on 2nd story roofs... And they likely aren't there 'cause they're still in use either !! They're there 'cause it costs too much money to take them down !

 

[pabeader]

but you can make quite a bit on them for scrap aluminium

 

[navychop]

Alert the FTA IS FOREVER squad! Away the "It's all Charlie Ergen & NPS's fault" team!

There are some posting in the FTA section that would have you believe that FTA and C band have a long future ahead of them, and any shrinkage of their group is due to devious activities by the aforementioned evil ones.

 

[Hall]

but you can make quite a bit on them for scrap aluminium

And the scam is, no one will take it down for free even though they'll almost double-dip by scrapping the aluminum. Granted, it may not be a fair trade-off, but my money says the person removing will offer to haul it away "for free" too !!

 

[Hall]

There are some posting in the FTA section that would have you believe that FTA and C band have a long future ahead of them, and any shrinkage of their group is due to devious activities by the aforementioned evil ones.

Why would anyone who's invested potentially a lot of money and their time want to believe otherwise ? Of course, if (when) it does die and go away, the response will be "well, I certainly got my money's worth out of it".

Folks who bought HD-DVD players thought that format would win and survive too... Betamax fans thought they were safe...

 

[TalonDancer]

A subsidy is usually a form of financial assistance. These networks are receiving money from cable and satellite distributors based upon contracts they've signed; no "financial assistance" necessary.......

Sorry, I don't buy it. Just because "These networks are receiving money from cable and satellite distributors based upon contracts they've signed", does not mean that those contracts do not embody 'subsides' in the form of 'financial assistance'.

On the contrary, all of the contracts supporting the 'packaged channels business model' are based on "subsidies". The packaging of multiple channels into a single subscription, by definition, subsidizes ALL the channels in that package. IOW each channel gets "financial assistance" by being part of the package. Because any given channel in the package, almost certainly, would have fewer subscribers if they were not part of the package. This is particularly true at the lowest package level available. Even the most "popular" channels in the entry level package (e.g. ESPN) would have fewer subscribers if every sub had the option to NOT sub to that channel. You even explicitly described the possible outcome of losing these 'subsidies' in your previous post "People don't realize that many people might not want to pay for their programming, and watch their channels go the way of the dodo." So why exactly would these channels "go the way of the dodo" if they were not being 'subsidized' (i.e. financial assistance) via the subscriptions of others, who would not pay for them unless they were required too in order to get the other channels in that package that they want?

Talon Dancer

p.s. Whether the loss of subs would translate into loss of revenue is a subject of debate that depends on the alternate business model.

 

[Greg Bimson]

So why exactly would these channels "go the way of the dodo" if they were not being 'subsidized' (i.e. financial assistance) via the subscriptions of others, who would not pay for them unless they were required too in order to get the other channels in that package that they want?

Because people are paying for a package of channels. It isn't like we are spectators at the Coliseum giving a thumbs up or down regarding these channels.

The assumption here is that something is being subsidized by the subscription of others. The reality is that you are buying a package of channels, and it is immaterial whether or not you watch them.

On the contrary, all of the contracts supporting the 'packaged channels business model' are based on "subsidies". The packaging of multiple channels into a single subscription, by definition, subsidizes ALL the channels in that package.

Which of course also means what you are "subsidizing" these multichannel providers that create these packages. Yet I don't see complaints that of the $50/month consumers spend on programming just under half of it stays with the provider. And of course, the provider then can hire people or build infrastructure. It's nice to see I'm "subsidizing" people's jobs.

Look, here's food for thought. ESPN's contract probably mentions something about placement in the most widely distributed package. How does one get around that? Dish Network could stop offering packages. But Dish Network wants to make money, so they won't do that. Yet all of the complaints are being directed at ESPN?

Even the most "popular" channels in the entry level package (e.g. ESPN) would have fewer subscribers if every sub had the option to NOT sub to that channel.

It's only two letter's long, but the biggest word in the dictionary: IF.

A la carte doesn't exist. And last I saw the big multichannel providers are raking in record profits. But no one is putting any of the blame on them.

The only way ESPN has ever been sold is as part of a package. And once again, I am back at this statement:

No one will be able to pick and choose channels until someone can show a business model where the programmer would make more money in an a la carte world, or until there is government intervention. And I say there isn't any chance for either.

 

[mike123abc]

The only business model that would work for DBS/Cable would be a minimum charge. In Dish's case it could go:

$35 monthly charge for service. Includes one box, plus $5 in programming credits. You get all the free channels (shopping and public interest).

Then they also charge a markup like lets say 25% for billing on any channel that wants to charge with lets say a minimum of 25 cents. So if a channel wants to charge 50 cents, it would cost 75 cents on Dish. If they (like HBO) wanted to charge $10, it would be $12.50 on Dish. This way Dish wants to sell you as many channels as possible since they get a cut on them.

Of course as I said earlier only a law that passed constitutional muster could force such a business model like it did with Cband. Note: not Cband as it is now but like it used to be 20 years ago when they forced every channel to be available at a resonable rate.

 

[Greg Bimson]

The only business model that would work for DBS/Cable would be a minimum charge.

Sure, but I see the concern here is with the multichannel provider.

I asked for a business model that shows where the programmer would make money.

And in the example given, I see there is no problem with giving Dish Network $35 a month yet there is concern about a few dollars here and there, but even the example puts caps on markups.

Of course as I said earlier only a law that passed constitutional muster could force such a business model like it did with Cband. Note: not Cband as it is now but like it used to be 20 years ago when they forced every channel to be available at a resonable rate.

I need to do some digging. Any idea on the name of that law?

And of course I'll get back to that "Cband as it is now but like it used to be 20 years ago when they forced every channel to be available at a resonable rate" comment. No one seem to realize that "but like it used to be" means it happened in the past; it failed because it could not be sustained.

 

[mike123abc]

It is the same law/regulation that the RSNs have tried to skirt by not putting their programming on satellite since they would have to make it available to everyone.

The cband a la carte failed because everyone moved away from cband, there are not enough customers to have competition in the programming. Now there are just a couple big (one owned by Charlie) programming resellers and they just bundle it up, although some are still available a la carte.

Cband failed because of 1) cost up front 2) have to have LOS across the sky and land to have huge Dish 3) only one receiver/TV 4) having to wait for the dish to move to change channels... etc, etc

If you could get DBS with multiple TVs and a bundle of channels at about the same price people were making installment payments on their BUD, why not go DBS?

 

[TalonDancer]

Because people are paying for a package of channels. ....

Me thinks thou doth attempt to defend the multi-channel package business model too much

ciao - Talon Dancer

 

[Greg Bimson]

Me thinks thou doth attempt to defend the multi-channel package business model too much

Have you viewed the poll results? There are close to 200 votes (198 I think), and only 33 of them are saying they'll pay more for a la carte than what they currently pay.

That means over 80 percent of the respondents are looking to either maintain their current rates or be cheaper with a la carte.

Everyone seems to be concerned with the current business model, i.e., portions of our monthly fees to distributors end up going to programmers. Only one person has made an argument how to setup user fees in an a la carte world. I'm just not so sure anyone has thought this through.

Here is a big point: in an a la carte world, the CSR staffing of the cable or satellite company would at least have to be doubled. Think about the amount of times people will need to add or delete channels. The consumers would need to "subsidize" the cabler or satellite company even more than they do now.

 

[pabeader]

response to point 1
it is possible that the poll response was misunderstood. when i re-read it i noticed that it could be interpreted two ways. either as 'i am willing' or 'i expect' i suspect that a number were responding 'i expect' when i really meant 'i am willing'
The creation of polling questions/responses is an art for sure.

response to point 2
just have the receiver do all the work. tune to a channel. if you have already paid for it, it comes on. if you haven't, up pops a box that asks if you want to. you say yes and zing. you now are a subscriber.

 

[Jhon69]

response to point 1
it is possible that the poll response was misunderstood. when i re-read it i noticed that it could be interpreted two ways. either as 'i am willing' or 'i expect' i suspect that a number were responding 'i expect' when i really meant 'i am willing'
The creation of polling questions/responses is an art for sure.

response to point 2
just have the receiver do all the work. tune to a channel. if you have already paid for it, it comes on. if you haven't, up pops a box that asks if you want to. you say yes and zing. you now are a subscriber.

You know there would be upset subscribers when their kid subscribes to a channel you don't want them to watch.

It seems to me that Dish network has the most ala cart channels as it is right now,but for a even cheaper price there are packages mainly due to the programmer's demands.