Senator McCain Proposing Legislation to Enable A La Carte Subscriptions

Discussion in 'Legislative and Regulatory Issues' started by alnielsen, May 9, 2013.

  1. May 9, 2013 #1 of 29

    alnielsen Godfather

    Dec 31, 2006
    ...- .....
    McCain is prepping legislation to overhaul pay-TV business
    The maverick wants to cook the TV industry's golden goose.
    Sen. John McCain (R-Ariz.) is preparing to introduce legislation perhaps as early as Thursday that would dramatically overhaul the television business and will probably be met with strong opposition from the broadcast and cable industries if it ever gets off the ground.
    Specifically, McCain wants to require pay-TV distributors to give consumers the option to buy channels on an individual or a la carte basis instead of the current system in which they must buy large bundles of channels.
    He is also interested in protecting Aereo Inc., the start-up that delivers the signals of broadcast TV networks -- including CBS, Fox and ABC -- to consumers via the Internet. Broadcasters say Aereo's service violates copyright laws and are suing in an attempt to shut it down.
    continued at:,0,6254534.story
  2. May 9, 2013 #2 of 29

    sigma1914 Well-Known Member

    Sep 5, 2006
    Allen, TX
    It won't get far whatsoever.
    1 person likes this.
  3. May 9, 2013 #3 of 29

    klang Hall Of Fame

    Oct 14, 2003
    I too doubt it will get past the industry lobbyists.

    If passed wouldn't this likely void all the existing contracts between the distributors and the content owners?
  4. May 9, 2013 #4 of 29

    Nick Charter Gold Club Member DBSTalk Club

    Apr 23, 2002
  5. May 9, 2013 #5 of 29

    dpeters11 Hall Of Fame

    May 30, 2007
    Either the article or the legislation is flawed. The article says that it would require distributors to give the option of a la carte, which is DirecTV, Dish etc. They wouldn't be able to do that without the media company.

    Of course we all know that if it did happen (and we know it won't), they would make it so that the individual channels were much more expensive. It might work for some, if you only watch 5 channels or something, but likely not work for the majority if it ends up costing $5-$10 a month per channel. If someone only watched one show, say Mad Men on AMC, they would probably only subscribe during that time, or even more likely, just drop it completely.

    But there is no way this will really go anywhere.
  6. May 9, 2013 #6 of 29

    gov Legend

    Jan 11, 2013
    Might be in effect, one of those bills that is actually a 'welfare for lawyers' kinda thing.

    To bad we can't invest in 'lawsuit futures' on the Chicago Board of Trade, there could be some serious money to be made off this mess, if only there was a way to get a taste of the action.
    1 person likes this.
  7. May 9, 2013 #7 of 29

    Nick Charter Gold Club Member DBSTalk Club

    Apr 23, 2002
    Personally, with many multiple streaming sources, I am no longer interested in a la carte.
    If you still want it, don't just bellyache here -- write to your congressman and senators.
  8. May 9, 2013 #8 of 29

    john262 AllStar

    Oct 26, 2011
    This proposal will face a lot of opposition from the industry, but as far as I'm concerned something must be done about the rising cost of cable and satellite services, which is rising six times faster than the overall rate of inflation. Such rapid price increases are unacceptable. Normally I would oppose government intervention in the marketplace, but in this case if it takes the government to step in to stop this then so be it.
  9. acostapimps

    acostapimps Hall Of Famer

    Nov 5, 2011
    If you think bundled channels is expensive with the current prices, just wait if they ever(which wouldn't happen) on a la carte, the prices could really jump sky high with content providers taking every chance they can to make it happen, They might make sweet deals at first then lured you in with exorbitant fees when it comes to ad revenues.
  10. Davenlr

    Davenlr Geek til I die

    Sep 16, 2006
    It worked out ok with the C band distribution system. You could subscribe to a channel by itself, of a group of 5 or 6 channels with genre content for less than the cost of the 5 or 6 individual channels. If you didnt want any national news channels, you wouldnt have to pay for them. If you just wanted Fox News, you could get it for $5 a month. If you wanted CNN and MSNBC and the other news channels, you could get them all for $10.

    For someone who likes a LOT of variety, it would end up costing a lot more. For cord cutters who might just want 1 regional sports network, one news channel, and a small group of general variety channels like TBS, it would work out to their benefit.

    It would also be nice for people who have, for example, DirecTv...with a full package, but wanted maybe 1 or 2 channels from DISH that DirecTv doesnt carry. They wouldnt have to pay DISH for the full package with lots of duplicated channels just to get the 1 or 2 missing channels.
  11. James Long

    James Long Ready for Uplink! Staff Member Super Moderator

    Apr 17, 2003
    C Band was a minor player ... not ~50 million subscribers and two of the top three providers like modern satellite carriers.

    I agree that this effort is dead unless it requires channel providers to offer channels a la carte. That is the level that needs addressed ... not the resellers who are forced by their contracts with the channels to bundle (or are offered deals that make it the wisest move) but the channel providers themselves.

    Of course, forcing providers to sell channels separately does not fix the pricing issues. Sen. McCain could learn a lot from the previous discussions on a la carte. If he can explain where an entity like ESPN could continue to operate their suite of channels without their current subscriber count or drastically raising prices should their subscriber count drop. They have to pay for programming somehow. And the smaller channels that would find themselves dropped by a lot of subscribers and not survive.
  12. jsk

    jsk Icon

    Dec 27, 2006
    Fallston, MD
    The reason cable/satellite bills keep going up is because the government allowed all of the mergers and there isn't as much competition. Also, the re-transmission consent law combined with the relaxation of ownership rules of TV stations have played a part as well.

    A la carte will be more expensive for most people. If each channel cost $5/mo (which it probably would be more), then you would only get 15 channels for the same amount that you are paying for AT250.
  13. Chihuahua

    Chihuahua Legend

    Sep 8, 2007
    I think al a carte would be a disaster.
  14. PBowie

    PBowie Legend

    Jan 4, 2006
    A lot of people have wanted a la carte for ages, however I doubt it would pass, since when has the industry EVER done anything FOR the consumer who pays for them?
  15. inazsully

    inazsully Icon

    Oct 3, 2006
    Nobody seems to think it would work but maybe we're brainwashed to think this way. How about a solution oriented option. Offer a choice of 12 channels from a list of the 50 most watched channels. All locals are included automatically and not part of you list of 12. ESPN and Fox RSN's are priced at a $10 premium. Your list of 12 channels are priced at $4 each. Any channels added beyond the base 12 will be at $7 each. I realize this isn't perfect but it's a solid easy to understand starting point. The folks that do not like sports will love this. We all know that the odds of anything like this happening are slim to none but if just one lone major provider takes the leap who knows what will happen. I'd bite.
  16. SayWhat?

    SayWhat? Know Nothing

    Jun 6, 2009
    The only way I can see it working for the end user is if the packages and prices were set by a third party; not the providers or distributors. And we know what the chances of that are.
  17. SayWhat?

    SayWhat? Know Nothing

    Jun 6, 2009
    Maybe something along the lines of amusement park ticket packages.

    Each channel would be assigned a letter/number value, or maybe even just a dollar rate.

    Packages would be offered for $25, $50, $75, etc.

    You could pick and choose channels (without regard of who the provider is) based on their assigned value up to your chosen package rate. You might end up with a few higher rate channels, or a lot of lower rate channels.

    Yeah, I know this goes back to the cBand type packages.
  18. Stewart Vernon

    Stewart Vernon Roving Reporter Staff Member Super Moderator DBSTalk Club

    Jan 7, 2005
    Kittrell, NC
    I always like how people want the "freedom" to pick any channel they want, but then want to go ahead and set those individual channel prices at something affordable to them.

    To paraphrase Spider-Man's uncle...

    With great freedom comes great unaffordability :)

    With each channel fighting its own battle, there's no way any of the most popular channels would ever then agree to be in a channel bundle that discounts them... Why would they do that?

    Now, with packages, they can agree to a lower per-channel price because they know approximately how many subscribers they are likely to see in that tier year-to-year... IF subscribers have the ability to drop any individual channel month-to-month... then channels will have to go month-to-month as well with their projections and likely charge a higher rate to compensate for those who will drop the channel frequently.

    There's just no way that a la carte leads to less-cost-per-channel. No way at all.

    Some people might see a lower bill if they watch less than 5-10 channels ever... but even then, I wager their bill will not be as small as they think it will be. Everybody else will end up paying the same or more to get the channels they want... and a whole bunch of channels will not be able to stay afloat... and it will be some channels that a lot of people like that go this way.
  19. James Long

    James Long Ready for Uplink! Staff Member Super Moderator

    Apr 17, 2003
    So $48 before the expensive channels? Then $7 for additional channels past the 12? No thank you! I'll stick with the packages. :)
    I wouldn't mind seeing my bill reduced ... that price plan would not be a reduction.

    The key to a la carte is to get programmers ... those who produce the channels ... to support it. Channels want to be in as many homes as possible. The current way to do that is to be cheap or popular and get a low tier placement. Cheap is not needed if the channel is a "must have" network.

    In the perfect (non existent) world of a la carte ESPN would still be $5. Without ~100 million subscribers ESPN could not afford to remain $5 and buy the programming they air. Does anyone really think that ESPN would step back from ~100 million subscribers and see what they could get at a higher price? They are better off being in the lowest tier.

    And if some provider says NO, ESPN can simply say "lowest tier or no carriage". A provider without ESPN long term (not just a month or two of negotiations) would lose subscribers. The power is in the hand of the programmer.

    So what is next? Government intervention to require ESPN to sell their product a la carte and not require their channel to be in a specified tier? Government price controls to keep ESPN from charging less subscribers more money to break even? Price controls to keep any channel from making "too much" profit? No thanks.

    Yes, I'd love to have a lower bill. But a la carte is not the answer.
    1 person likes this.
  20. Gloria_Chavez

    Gloria_Chavez Godfather

    Aug 11, 2008
    ESPN is ever so profitable. About 50% of Disney's market value is ascribed to the folks at Bristol.

    And they'll never give it up.

    Which is why PayTv prices will continue increasing at rates well above inflation.

    Which is why Aereo (8 dollars a month w/ cloud-based DVR) will continue to gain traction.

    Ironically, one of legal precedents used by Aereo in its litigation was the Cablevision cloud-based DVR, which no one had any objection to at the time.

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