Trying to Break the Iron Grip of Package Television Deals

According to a BBC News report this morning, Time Warner made a move to resolve the current CBS blackout that may turn out to be the first shot in a revolutionary war over cable pricing. It basically said that it was willing to restore CBS service to those customers willing to pay for it as if it were a paid channel like HBO. CBS wasted no time rejecting the proposal. Their ratings have been such that they know they get a better deal by charging a flat fee to Time Warner that gets them included in the "basic" package, regardless of how many people actually watch their programs. This means that they can maintain their priority of appealing to would-be advertisers over appealing to viewers.

Those of us on the other side of the set-top box, whether for cable, satellite, or even an Internet connection, know better. My Comcast box has now allocated all 999 of its channel slot. I know enough of my own viewing habits to observe that this means that there are hundreds of channels I do not watch and probably would never even think of watching. Even under the package I currently receive, that number is probably still more than 100. I can think of any number of alternative fee schedules structured around what I really watch that would give me a lower monthly bill; and, from a logical point of view, it makes sense that Comcast would translate that lack of demand to the content providers that do not get very many viewers. This might even lead to a better economic model for all those previously failed efforts of "serious arts" channels, which would be to find the right "sweet spot" between a smaller number of viewers willing to spend a larger amount of money.

Will there really be a revolution? Probably not. Businesses survive on the basis of inertia, no matter how many evangelists preach innovation at the top of their lungs. Furthermore, the very concepts of "public good" and "successful business" are further apart than ever. This will probably turn out to be yet another case in which we live with the status quo as it gets less and less effective until, finally, "the machine stops;" and nothing is left.