Joe Flint tries to pass off analyst Todd Juenger's argument that cable prices really aren't that bad and that a la carte won't work. The reasoning on both counts is servery flawed.
The article starts off with a graph showing the price increases of various items from movie tickets to cups of coffee. The idea is to show that in comparison the recent increases in the price for cable TV is more than reasonable. The problem is all of the items listed (with the possible exception of health care) are voluntary purchases. If I think the price of Dunkin Donuts coffee is getting too expensive then I can go to McDonald's for their $1 large coffee. If I buy a cigar - the tobacco industry doesn't tell me I also have to purchase a pack of cigarettes and some nicorette gum as part of the package. Yet that's what cable TV does. You want ESPN - then you have to get at least 3 other channels along with that.
Then the example of if Nickelodeon was an a la carte option then viewers may have to say goodbye to shows like Dora the Explorer or SpongeBob SquarePants is used. Not sure if two worse examples of the effects of a la carte could have been chosen. Both shows are cartoons with low production costs and both shows probably make more in merchandising and web applications at this point than in affiliate rights. A la carte won't harm those two shows in the least.
I was told that consumers being able to buy individual MP3's of songs would kill CD sales. But it didn't - it just created a new market - for MP3 songs! And it also allowed entry into the market many of many more artists and bands.
So too with TV. If a la carte was available and a provider could simply give me a menu of choices - that provider probably would have incentive to put as many channels on that menu as possible. Instead of just the History Channel maybe a channel is put on the menu that actually shows history. I would subscribe to that and then maybe History would see that success and rethink doing shows like Ancient Aliens.
But I digress.
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