Cherrypicking cable channels won’t make sense in an on-demand future
The prospect of consumers getting the ability to choose which cable channels they want has proven to be a remarkably resilient fantasy.
Maybe that’s because TV executives can’t seem to resist giving the proposition just enough attention to make it seem possible. Verizon CEO Lowell McAdam described the a la carte business model at the National Assn. of Broadcasters confab earlier this month as “a novel way that could help protect subscriptions in the long run.” An unprecedented antitrust suit filed by Cablevision against Viacom has also renewed speculation.
But now is as good a time as any to point out the absurdity inherent in a debate that has raged from Congress to coffee shops going back a decade. A-la-carte channel choice no longer makes a lick of sense in the age of on-demand viewing. A post-bundle world would require a much different environment than the one a la carte fans envision, one that probably draws more on title-oriented platforms like Netflix or iTunes than on TV’s linear lineage.
A la carte might seem too damned reasonable to criticize. After all, if the average U.S. home watches only about 16 channels per month out of the 135 channels a typical pay TV subscription provides, why can’t it just be given a menu from which to pick and choose channels?
But programmers and distributors have more than $30 billion worth of reasons to not break up the bundle of channels they’ve sold together since the pay TV biz began.
Still, let’s put aside for a moment the contention that content companies have long made, which is that individual channels would cost so much more in an a la carte scenario that unbundling won’t be worth it. Instead, think about your favorite channel: How many individual programs on it do you regularly watch?
There’s no available data on this, but consider there are maybe one or two channels out there at most that inspire the kind of devotion where you’re watching more than half of the content available on a particular channel. But beyond that, who really watches more than 10% of what’s available on any single channel?
In our long-suppressed zeal to free ourselves of the multichannel bundle, it’s easy to overlook that a network in and of itself is just another kind of bundle.
A la carte is a conceptual slippery slope: If a consumer is given the ability to cherrypick, say, Bravo, but forgo Disney Channel and Nickelodeon why would the same consumers be OK with paying for Bravo shows “Rachel Zoe Project” and “Watch What Happens Live” when all they want is “Top Chef?” If I just want one hour of a channel, why would I pay for 23 others I don’t want?
And if you enjoy “Top Chef,” it’s possible you’re likelier to watch Food Network’s “Chopped” or HGTV’s “Ace of Cakes” than non-foodie Bravo programming. A cross-channel purchase based on genre is more compelling than any one channel.
A la carte confuses the true brand currency of the TV kingdom: it’s the shows, not the channels. The programming-to-pricing ratio will be out of whack as long as the channel model holds sway.
To create a marketplace truly better off without the bundle, content companies would have to share their product in one massive trove for onestop shopping of tens of thousands of programs, where they can be re-aggregated by consumers free of traditional borders including channels, production companies and the conglomerates themselves. Then let great user experience and data-mining take care of the rest.
That may not mean the channels of yesteryear go away entirely. But the notion that unbundling will leave channels more important than ever, is folly. A la carte is a delusion we’ve held onto for so long that no one bothered to notice how obsolete it already is.