Monday, August 12, 2013

Paying for what you don’t watch

The cable and satellite wars continue to be waged between the people who make the programs you watch (or don’t watch) and the people who deliver them to your TV.  Most recently the battle is between CBS and Time Warner.  The giant cable company refuses to pay CBS what the company maintains are excessive fees to carry “How I Met Your Mother” or “Dexter.”  Things are not going well in the 500 channel universe because that universe is enabled by an arcane business plan, a plan that is under fire from politicians and consumers.
The cable or satellite providers pay for each of the channels that they carry on their systems.  Those fees are passed on to you as part of your monthly bill.  The fees you pay are all over the map.  In our area you pay as much as $5.00 per month for ESPN and perhaps only 25 cents for the “Wallpaper Channel.”  Whether you watch either makes no difference.  This practice is being scrutinized by some in government and exploited by some of the new players using the Internet to deliver TV programming.
If you are like most TV viewers you watch only a handful of channels.  One or two favorite local stations, a news channel, a weather channel and one or two specialty channels like ESPN, HGTV and HBO.  Once in a while you may venture to some more eclectic fare but that is the exception.   What many are asking is why they can’t choose from a menu what they want and pay only for those services.  After all, when you go to Kroger and buy a pound of ground beef you are not required to also buy charcoal, peanut butter and three rolls of toilet tissue.
The popularity of the Netflix, Hulu and Amazon online video services continues to erode cable’s dominance offering viewers what they want, when they want it and at a very competitive price.  Aereo delivers on the Internet, in a handful of major cities, an a la carte menu of channels allowing the viewer flexibility in what they watch, when they watch it and what they pay for.  What a concept!  Many of the established players in the TV game have tried in the courts to stop Aereo but to date have been unsuccessful.
There is really no simple solution.  Backers of the status quo point out that in an a la carte world only 25 channels would survive making diversity in content disappear.  Those pushing for change note that there is little diversity now with copy cat programming becoming the rule.  How many more weird Pawn Shop owners do we need to watch?
The power of the dollar will ultimately prevail.  Even with the flawed channel bundling business plan, the big cable companies are making a lot of money.  There is little impetus for change now.  I look for change as TV viewing transitions to a combination of online and on demand delivery via the Internet leaving only late breaking news and sports to be  the bread and butter of cable and broadcast.


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