What is kind of ridiculous is that the channels that are responsible for the large price increases stay put. Isn't Fox and it's Fox News Channel and other channels responsible for the primary rate increases this year? I am sure that Sprout is not very costly in the grand mix of things. I think it should be Fox channels that get pushed up. Screw fox and it's greed.
Simple and its not ridiculous at all if you understand how the television programming world works. A channel like Fox News (#1 channel in the US), USA, ESPN, etc can demand penetration in 90% or higher of a distributor's base. They have that leverage.
Well, if you're a distributor and you need to have that channel available to 90% of your customers, you can't very well take it out and move it to a higher tier where there are far fewer customers. You would be in breach of the contract.
Channels like Cloo, Sprout and dozens of others do not command that kind of leverage. If DTV (and all other distributors continue to suffer because of programming costs) then they have only a few choices at their disposal.
1) Move some channels to higher tiers to reduce overall programming costs because they only pay the provider based on the number of subs. That forces people who really want it to buy it.
2) Raise prices
3) Continue to hammer programmers with the threat of moving them to higher tiered packages unless they drop their rates
4) Take less profits (sounds great for a consumer, has dire consequences long term on innovation, sustainability, etc)
I guarantee you that there were far more channels that were going to be moved from some of these packages but the threat made some of these programmers come to the table and make a better deal. Guarantee it.