Lawmaker Urges Look at Cable a la Carte

[Steve Mehs]

John McCain, the Arizona Republican and chairman of the Senate Commerce Committee, has recommended that cable operators consider allowing their customers to pick and choose the programming they receive.

In a letter sent to the nation's top cable operators, McCain said they should look at the carriage deal announced last week by Cablevision and Yankees Entertainment and Sports (YES). The agreement with YES, which was missing from Cablevision's lineup last baseball season, allows viewers to get the channel through a sports package or on an a la carte basis.

"Although not a complete solution to the problem of skyrocketing rates, this agreement seems to be an important first step to lowering cable rates by providing consumers with more choice," McCain said in the letter.

He added, "I challenge you to provide your customers with similar choices, especially with respect to the most expensive programming, like sports, that continue to drive up cable rates."

According to reports, McCain sent the letter to executives at Comcast, Time Warner Cable, Charter, Cox Communications and Adelphia.

From SkyReport (http://www.skyreport.com/skyreport/mar2003/031703.shtm#one) (Used with Permission)

[Mark Holtz]

Darth Maus is probably :rofl: at the moment.

[tampa8]

Unless there are some major major changes and/or laws this idea cannot work based on cost. It can of course be done but at a great cost to the consumer. You would pay dearly for some channels - those that not enough others are getting to keep the cost down. For those that do not want to subsidize sport channels this might at first sound good, but let's say you love the IFC channel but very few others do. Then, say the WE channel - only a few. Just takes a very few of these and the cost to keep them will be as high or nearly so as the the complete package you now get.

Providers certainly play the game to get you to subscribe to higher packages by putting some of the popular channels in them, but the idea of packaging is consumer friendly based on what the cost would be otherwise.

[Cyclone]

McCain loves to say things that people want to hear, but are impossible to implement.

[jasonf]

not true. Look at the canadian packages.... they are packaged way better the US ones.

[Brett]

The major problem is analog cable which is the dominant multi-channel platform. Cable systems cannot afford to trap out most basic channels in such manner. So, there is the basic cable package. Since program contracts are modeled for cable, DBS is inclined to follow basic packages also since DBS is basically cable in the sky.

Dish is able to sell Outdoor Channel, Bloomberg and Golf Channel alacarte. The DBS companies can make agreements to get few other channels alacarte (in addition to being sold in a package), but neither provider has done so lately. Those 3 channels were alacarte before the introduction of AT 150. No new channels have been made alacarte. The only new channels alacarte are internationals which have a higher markup.

[tampa8]

Originally posted by jasonf
not true. Look at the canadian packages.... they are packaged way better the US ones.

Didn't quite get what is not true. You said it yourself in your post - the Canadian "packages." You might consider them better but they are still packages.

The stand alone channels on Dish are $1.50 each if it hasn't changed. That would be about 16 channels in a package cost of what Dish now offers in the top 50 package. Yes it might be the exact package you want, but at quite a cost. I also must point out there would have to be a minimum purchase - guessing the Dish lowest price of $24. Otherwise you would have to buy the equipment at the real cost and probably pay a monthly access fee, otherwise there would not be enough revenue.

[Mike123abc]

Well if I could pick my top 16 channels out of AT150 and only pay $24 I would probably go with it. If I had even more choice and were able to include some supers in there, I would jump on that! 16 channels in AT150+Supers is probably more than I watch.

[tampa8]

Originally posted by Mike123abc
Well if I could pick my top 16 channels out of AT150 and only pay $24 I would probably go with it. If I had even more choice and were able to include some supers in there, I would jump on that! 16 channels in AT150+Supers is probably more than I watch.

If there are enough others who feel like you it might work. It just seems llike most people want much more than 16 channels. But there just might be a market of those who want to pick exactly what they want even at a greater cost. I would think the more choices a provider can give the better.

[sorahl]

Ah yes, McCain, one of the co authors of that wonderful and completely illegal anti constitutional piece of campaign finance legislation.
Bah

[Ken_F]

The stand alone channels on Dish are $1.50 each if it hasn't changed. That would be about 16 channels in a package cost of what Dish now offers in the top 50 package. Dish no longer offers channels a la carte for $1.50/ea, and they haven't for quite some time. Dish is already paying in the range of $2.20 to $2.40 for ESPN, and it will cost over $2.60 next year if the pricing trend for that channel continues. There are a few other channels that cost in the range of $1.00/ea.

If we do ultimately get a pick-and-choose plan, there would probably have to be tiers available, with certain programming only selectable under certain tiers. For example, there's no way they could offer ESPN as a choice with a "10 channels for $14.99" price tier.

Of course, a major problem with "pick and choose" plans is that the provider loses out on the money from shopping and certain other channels. These channels actually pay DISH and DirecTV for carriage (anywhere from $0.02 per subscriber to $0.50 per subscriber), which helps to offset some of the costs of other programming. If the shopping channels were to go, that increases the effective cost of the other programming for the subscriber.

[tampa8]

Dish does indeed still offer a la carte channels, at least two of them. For much more than they used to however. OLN is $1.99 a month and the GOLF channel is $4.99 a month. They were offering the Speed channel also but I do not see it now. Going by these costs, if you go back to my post above, it would appear you would get even less channels for your money or have to pay even more money. Again, unless there is a complete overhaul of the system drastically reducing the cost to the providers, I just don't see how a la carte would work out.

[durl]

When the federal government can actually rein in it's own spending, I MIGHT try to take them seriously when they say they want to do things to save me money. It's a free market economy, let the consumers decide.

Nice point about the campaign finance reform bill, sorahl. (but I prefer to call it the "shut down free speech during campaigns" bill)

[Jacob S]

The new Cablevision Rainbow satellite service that is starting up at the end of the year at 61.5 is going to offer certain channels a la carte while others will not be offered a la carte because of the program provider agreements. SES that will be at 105.5 in the future will also offer a la carte. Why can't Dish or Direct offer it a la carte if those providers can? I believe there are more channels that could be offered a la carte by the providers.

I know that M2 has been offered for free (one reason why you seen it go from top 100 to top 50 package), that OLN and GOLF is offered a la carte, and so is an Encore Thematic package as well as a Discovery Thematic package for $4.99 each. Also the movie packages or the locals are offered a la carte on Dish with an extra $4.99 fee. Perhaps Dish could do this a bit better if that $4.99 fee was applied. Dish wants that extra $4.99 to make up for profits they are not receiving off of the channels.

People have been saying that DirecTv does not even have a cheap package or a la carte available. I thought there was a package where you could order just the music channels for under $10.