Is A La Carte TV a "Farce?"

Chase Carey, Twenty-first Century Fox chief operating officer says a la carte TV--the ability to buy any single programming network, a TV series or a single channel, is a “farce.” 

At a high level, Carey simply is arguing that the current practice of bundling channels together provides the greatest value for consumers.

Skeptics would say that is an executive defending a business model that supports supplier revenue models and profit margins. 

Others would say what also is at stake is a related practice, namely the programming contracts that require distributors to buy lesser-viewed channels in order to buy a "must have" channel. In other words, to gain the right to distribute ESPN, a service provider has to agree to carry a number of other lesser-viewed channels owned by Disney (ESPN owner) as well.

But even some who support the idea that consumers ought to be able to buy their content a la carte might agree that it is not clear every consumer would save money under such a regime. 

Generally speaking, consumers content to by only a few channels might save money. But most consumers would spend less money buying a bundle of channels. Heavy users would find a la carte an expensive proposition, and clearly would be better off with the bundled channel price.

Most long-time observers might agree that the total number of viable channels would shrink drastically in an a la carte retail environment, and programming executives say consumers would pay more, for a single channel, than at present.

Some studies suggest that is the case. Other studies suggest prices for most consumers might not change much. The point is that it is unclear whether most consumer would save money on video in a shift to a la carte packaging.

Programmers say prices per channel would grow substantially, but consumer think channels will not cost much. Consumers generally estimate per-channel prices in the $2 each range, while programmers tend to believe prices will be closer to 300 percent higher, for most channels, one might argue.

If a la carte access to TV channels is a "farce," it might therefore be most true in the sense that the notion most customers would save money is profoundly wrong. 

A la carte might not be a farce for buyers who really only want to watch a few channels. 

And a la carte is no "farce" in a business sense, for programmers. It might be an industry-changing event. 

Post a Comment

Popular posts from this blog

Voice Usage and Texting Trends Headed in Opposite Directions

What to Do About Industry Challenges? "Take the Package," One Exec Quips

Verizon has a Brand Promise Problem