Suit Seeks 'A La Carte' TV Channel Choices

An anonymous reader writes "A breathtaking lawsuit was filed this week against every major player in the 'for-pay' television industry. Every major broadband and cable company in the US was named in the federal suit, which seeks the right to obtain content piecemeal rather than in the large (and expensive) packages that cable companies offer as the only option right now. This follows closely on the heels of encouraging comments from the FCC chair that he supports this kind of service. 'The complex web of contractual arrangements among service providers and networks amounts to a monopoly or cartel that has "deprived consumers of choice, caused them to pay inflated prices for cable television and forced them to pay for cable channels they do not want and do not watch," [antitrust lawyer Maxwell M. Blecher] wrote in the complaint filed on behalf of cable subscribers in several states. The complaint, which alleges a conspiracy to monopolize as well as violations of federal antitrust laws, names nine plaintiffs, but Blecher wants the U.S. District Court to certify it as a class action.'"

they have a up hill battle

Networks like Discovery DEMAND that the lesser channels of theirs also be carried and forced upon the viewers and subscribers. Lots of Content networks do this to ensure their lesser and crap channels get viewership.

They need to start there making it illegal for networks to demand that if you want to carry or subscribe to XYZ channel you do not have to get DEF and the crappy ZBZ channel as well.

True...

But even so, it's hard to see how anyone could possibly find it justified at this point in time. If it weren't for the DMCA, we could get it by show off of YouTube...Clearly there is no technical limitation.

It comes down to the fact that their business model is more and more dated by technology. No one is obligated to provide them a free ride.

Re:True...

Exactly but suing the cable companies will do nothing. they need to sue the content providers.

digital cable boxes can do alacarte Tv channels right now. we demoed it 4 years ago at a comcast meeting in detriot. current gear and billing and control system can do it RIGHT NOW. It's the content providers that are forcing most of the bundling.

Oh and the greatest profits are from the bundling, but all the cable companies will use the "we cant under contract" excuse to wiggle out.

you have to attack the content creators first.

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Except the cable customers have no direct standing in agreements with the content providers. By suing the cable companies they get a legal ruling breaking those agreements. The cable companies can then go up against the content providers.

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Shaw Cable in calgary has the basic set of channels, but all of the other channels are individual choices with discounts for 3 channels, 5 or whatever but you can pick them. There is also no time commitment, all you do is phone them up say I want to have t

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I don't know about you, but I wouldn't want to watch whole shows at youtube quality if I could just buy a DVD (which is what I do.. I don't tend to watch TV as it generally is a complete waste of time).

Re:True...

I'd love to ditch CNN. I only read their website nowadays. That network is 99.9% talking heads endlessly pontificating or theorizing. "Well Bob, IF they had planted a bomb here it would've blown up the world. Senator, do you have a world destruction prevention plan? We have a report that it MIGHT have been painted blue, more on that later. What, we still have 28 minutes to kill? Shit..."

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Lots of Content networks do this to ensure their lesser and crap channels get viewership.

Course, I wouldn't count 'viewership' as actually watching it. There's a world of difference between making something available and someone actually taking advantage

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When selling ad's on your channel it does not matter. saying "Discovery Rome lite" is available on 3500 cable networks is all that matters.

you have to justify to the guy buying your Ad air time why he is not wasing money on a channel that is probably not

You're an idiot.

I produce television programming for cable. If you don't think advertisers are savvy enough to know the difference between the number of homes a network is available in and the number of people actually watching a particular program, you're an idiot. The

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Have you ever taken a statistics class? Nielsen's sample is hardly "ridiculously small" by any definition of sampling methodologies. From: http://www.nielsenmedia.com/nc/portal/site/Public/menuitem.55dc65b4a7d5adff3f65936147a062a0/?vgnextoid=4f5247f8b526 [nielsenmedia.com]

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It's not going to matter, because they will make ala-carte so expensive that nobody will use it. It'll be this sort of "sure, we'll comply -- and fuck you -- it's going to be $20 per channel".

I'm fucking tired of paying through the nose so that I can have

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You want to demand that a company offers to sell you a product in a way it doesn't want to sell. We should demand that record stores be required to sell the CD only with no case or liner notes for less! We should demand that McDonalds sell you the burger w

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In non-monopoly markets, all of that is actually quite possible.

Several burger chains sell extra paties ala carte. "OEM" versions of cars and trucks exist and as well as plenty of aftermarket mosds. You can get marinara in ANY variety you want. They even s

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Right. In real capitalism, companies offer variety if they think it will make them more money. Why not, instead of trying to force the monopoly to do what they likely would if it were not a monopoly, remove the government-sanctioned monopoly?

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Seriously. Why do you want to legislate that private corporations sell something they don't want to?

Because they are being granted a monopoly on service in a given area. When the consumer cannot influence the supplier through the free market, other meth

Excellent News

This is awesome. I have a 'digital plus' cable package with over 200 channels, which I had to buy because the 4-5 channels I regularly watch were on that list. I would love to get rid of the other 190 channels or so, (200-(5 I watch)-(5 or so others I occasionally use/check)) and if I could get a price cut at the same time, that'd be even better.

Re:Excellent News

This is awesome. I have a 'digital plus' cable package with over 200 channels, which I had to buy because the 4-5 channels I regularly watch were on that list. I would love to get rid of the other 190 channels or so, (200-(5 I watch)-(5 or so others I occasionally use/check)) and if I could get a price cut at the same time, that'd be even better.

That won't happen. If anyone thinks they can take their current bill and divide by the fraction of channels they watch to get a new a la carte bill, they're deluding themselves.

I'm also not quite getting the basis of the lawsuit. Can I sue the grocery store for refusing to sell me one egg?

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***That won't happen. If anyone thinks they can take their current bill and divide by the fraction of channels they watch to get a new a la carte bill, they're deluding themselves. ***

Of course. BUT, if you look at the rates for C-band which is a la car

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Weird, my store only sells them in prime numbers.

You can't afford them either way.

The problem is, a lot of people are dumb. They can't look at more than one step of a problem.

Dumb person:

I am paying $100/month for 200 channels, but I only watch 5. If I could pay ala-carte, I could get the 5 channels I want for only $2.50!

Smart Person:

A La cart channels NO - A La cart programing SI!

If this happens the providers will respond by separating popular shows on to their own channels. The top rated content will be padded with junk you don't want to watch. The only answer is to sell shows individually.

 

80% discount theme park tickets

I only ride 20% of the rides at the local theme park, should I get an 80% discount?

No, but you have a choice

you can go to a park with per ride admissions, or to a park with all day admissions.
and you have a choice.

I am juste olde enough to remember pinning myself at Disneyland CA with the cute pins and my ticket to indicate having an all day pass-- as opposed to paying per ride... but-- I don't have to go to disneyland... I can go to the local carnival....

furthermore, amusement parks don't have governmental granted monopolies over a certain geographical area.
Businesses with Gov granted exclusive privleges by god do need clamping down/regulations.. or they will certainly run rampant... and this goal has no real hurdles, other than the desires for a fat bottom line on the part of the corps.
nothing else... and if the 'people' grant them the exclusive privlege of serving the 'people' then the 'people' should be able to place limits on what they get..

Re:80% discount theme park tickets

when I bought Windows XP

You're on the wrong website.

Go Lawyer, Go!

Of course I'm rooting for this one -

In my area, I can get basic cable ($50), the local high-def channels ($0), and a DVR ($9). Sounds pretty good, right?

Oh wait, if I want the "Navigator" functionality (the ability to use the digital cable's menus and program recordings), I have to pay $3 AND purchase a $30 "Digital Tier" pack of complete crap channels.

If I built a new MythTV box (no local phone line, so no TiVo... has that changed lately?), it would take several years to recoup my costs. Monetarily, I don't think it would be worth it; however, it's tempting to take a hit just to make sure the money I do spend doesn't end up in Time Warner's pocket.

Well, here's your problem

Disclaimer: I work in accounting for a large cable company, so I'm going to be a bit biased.

We would love to offer a la carte programming, but there are two huge obstacles.

1) Many times, we are charged per cable subscriber for a network even if we don't offer it the subscriber. ESPN is this way, as well as some of the sports channels. You'll pay for it as a customer even if you don't want it, because we get charged for it. That charge is comming to you one way or another, either through a package price or a base price as a cost of business. If you don't want ESPN, we're still paying for you to have it.

2) Many networks like Discovery and Fine Living give us massive price breaks if we show their second and third tier channels to a certain percent of subscribers. If we ran an a la carte service, this would be a nightmare. It means that if in a given month, if 30% of our subscribers didn't want Fine Living, but wanted Food TV, your price would triple. Do you really want to have a monthly bill that fluctuates that badly from month-to-month based on the whim of a TV network?

This isn't meant to FUD you. God knows, we'd like to be able to offer you a la carte, we have the technology to do it. And honestly, even though cable and sat companies piss customers off, we don't really want to. You are our customers. But to the networks, YOU ARE NOT THE CUSTOMER, YOU ARE THE PRODUCT. The advertisers are the customers, and they are selling your eyeballs. Until that situation changes, and the networks have less power over us in contact negotiations, you probably won't see a la carte. For all the malfeasance you can lay at the feet of cable companies, this is surprisingly not included.

Re:Well, here's your problem

Palladiate,

You seem to be a nice guy. Just leave the whole damnded cable tv company when you get a chance. Their business model is doomed and they are headed to where radio is. As you correctly point out, in the advertisement supported video content model, the viewers are product, not customers. People with more discretionary income will be quickly cherry picked by internet based content delivery systems. As the high income people drop out of the viewership, you need to get louder and shriller with the ads and that will drive more people out. Once all people who are willing to pay for the content leave, the disposable income of the viewers left in your domain will be very small. You might still have 50% of the current viewers, but disposable income is very unevenly distributed towards the higher end. Your top 20% of the viewers have 80% of the disposable income. It does not take much for the ad supported model to lose 50% or 66% of the value.

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I have trouble imagining how a non-ad-supported model would work, especially for the majority of Americans who watch a lot more TV than the average Slashdotter. Let's take Friends for example - that show reputedly would pull in $500K per min per new episod

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"Disclaimer: I work in accounting for a large cable company,"

If you work for Comcast, could you PLEASE put the CEO and the president of the Big Ten into a room and let them beat each other until they can come to SOME agreement about this Big Ten Network fi

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1) Many times, we are charged per cable subscriber for a network even if we don't offer it the subscriber.

Then don't offer it. If you have to pay $20 per month for ESPN (because it comes bundled with 40 other sports channels) but no one would pay $20 fo

Innovative

But we can't do that. They wouldn't let us show Fine Living but NOT Food Network. We could potentially do a la carte for packages, but we kinda do that already. The only improvement would be to break the bigger packages along networks. But you'll still see lots of crap channels bundled with the likes of Viacom.

Remember, our relationship with networks isn't friendly. Comcast got sued, and we're under current litigation over the remote DVR "Start Over" service. It's copyright infringement to start the show over if you switch the channel, because we're the ones recording it, not you. Heck, we get threats all the time during negotiations over offering the DVR service. Networks are convinced that home recording is illegal and think we may be liable because we aren't forcing you to watch your show in 3 days without skipping commercials or delete it. They think shifting the commercial time as much as 30 minutes ruins the value of the commercial.

Sure, we may be incompetent from no weak competition. But we don't get get our jollies by screwing customers. Remember, if a network can keep your eyeballs, they'll run roughshod over you. Viacom knows there's no substitute for MTV, but God knows if we piss off enough customers, sat TV would destroy us.

Re:Innovative

They wouldn't let us show Fine Living but NOT Food Network.

I see this as an illegal use of a monopoly. Fine Living as a product has a monopoly granted to it by copyright. No one else can take Fine Living and resell it without permission (and a contract) from the content owners. Yes, there may be other channels that offer shows on the same theme, but they are not the same thing.

And so the owners of the Fine Living monopoly force their customers to also buy Food Network if they wish to buy Fine Living. This is what I see as the illegal part. It's not illegal to have a monopoly - heck, copyright law grants it every day, even to this post to Slashdot. But it is illegal (or should be illegal) to use a monopoly to force your way into other markets, or to use your monopoly to expand your monopoly. That's how I see content providers' bundles.

Note: If you wish to republish this post, you are required to exclusively buy and use SydShamino brand toothpaste. That's right, SydShamino brand toothpaste, with less glycol than the competition!

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Personally I belong to that elite "Telemundo-Fox-HSN-Oxygen" viewer demographic.

Premium vs non-premium

Interestingly, channels like HBO and Cinemax (Time-Warner companies) are cheap compared to ad network channels like ESPN (around $6 a head). Our basic access, which is dirt cheap at under $10 a month, you get the local channels, and the shop-at-home chann

We do this, it's not that effective

First, we'll drop smaller networks that try and play rough. We can afford to.

But what happens when Fox wants a better deal? They run commercials saying how the local cable company is trying to take your channels away. Most of our customers think they

Short memories

My local cable company did just this in the mid 1980s or so. I don't remember the exact numbers, but it was something like $20 for all 30 channels. Or, you could pay $10/month for the first tier of channels, plus $2/ea to add more channels. If you wanted anything more than a small handful of a la carte channels, it was vastly more expensive to purchase them outside of the bundle. We may think we want a la carte, but the devil is in the details. As long as cable companies are monopolies, you can bet on any such "changes" remaining a better deal for the cable companies than anyone else.

ESPN

ESPN is one of the most expensive, if not the most expensive channel on your cable system. It costs them a ton of money to carry it, and the costs are passed on to you whether you watch it or not. I'd be more than happy to be given a chance to get rid of it forever.

ESPN

It's always aggravated me that I have to pay for ESPN, reputedly one of the most expensive channels on cable, because ESPN has the market power to force their inclusion in the basic tier. To receive the Science Channel and the National Geographic Channel, I have to pay for a tier that includes all sorts of crap that I don't watch.

I think it's silly

If this lawsuit results in a change in policy, it will mean nothing for most people. Selling channels on a per-channel basis is more complicated for the cable providers, and will thus be more expensive per-channel. Unless you literally watch only one cable channel, you will probably pay more to pick-and-choose 2-4 channels than you would pay for an entire package, including 90% channels you don't care about.

I used to work for Cox Communications, and in my area, "limited" cable is $11/month (channels 2-22, aka fancy rabbit ears). "Expanded" is an additional ~$30 (23-72). And the digital tiers are something like $2/month (for 5 to 20 channels per tier each). (HBO, Starz, Cinemax, etc, are priced entirely differently).

The digital channels (which are most popular to complain about--probably because there's the perception that there are "hundreds" of them due to their channel numbers reaching into the 300's and 400's in some cases) are by far the cheapest channels there are, and it doesn't make sense to break up a package that cheap.

Where it might have an impact for some people, is breaking up the "Expanded" tier (most cable companies have something similar), as the bulk of that $30/month price is the subscription fee the cable network pays to ESPN (something like $24/mo, if I recall).

If my memory is accurate, and the ESPN fee is $20+/month, then that means the other channels (23-72 minus ESPN) are $10/mo or less. And then it's suddenly very "reasonable" again.

Of course... if cable channels are sold a la carte, then the price per channel will go up by necessity. The *average* cable bill will still be roughly the same as it is now (assuming the programming also stays the same--and of course it wouldn't). The difference would be that families with 8 members who actually use 2 dozen channels would pay a higher cable bill, and single-member households (like mine) will only subscribe to 2 channels, and pay less.

I guess what it all comes down to me is: It's a lot of fuss about something that isn't a big deal, and it's just as likely (if not more likely) to hurt the consumer as it is to help them, except in fringe cases.

Anyone ever heard of this?

The apartment I just moved into REQUIRES all residents to have basic cable. (You can't have just Cable Internet, and because you don't have cable on your own account (it's built into the rent), you can't get a "package discount" by having Internet + Cable. Oh right, they also charge about $10/mo more for basic cable than the cable company directly would sell you, even without any discounts.

Has anyone ever heard of this? This sounds like more of an abuse than a cable company setting prices however /they/ want. (after all, you can always just choose not the have cable, you whiny handout-wanting bastards). This "cable is required" thing was sprung on me after I'd given notice at my previous apartment.

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Call your local Board of Public Utilities or other agency as appropriate. That sounds illegal, but local laws vary, especially when it comes to apartment buildings.

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Illegal. See FCC [fcc.gov] regulations [akamaitech.net] on this.

Guilty Pleasures

But, how else am I going to enjoy my guilty pleasure of E! without the cover of subscribing to the "extended lineup"?

It's the cable equivalent of walking up to the rental counter with Super Slut Cum Fest #9 sandwiched between Howard the Duck and Sleepless in Seattle.

Say goodbye to good programming

While this sounds like a good idea, it would ultimately mean the death of a lot of good programming and channels. Yes, you may only watch 10 channels, but are those the most popular 10 channels? If they aren't, they may not make enough money to survive in an ala carte setup. Something like G4 (which yes, is nowhere near as good as it was but still has some good shows like X-Play) probably would never make it if it was subscriber only, as it is a niche channel. There just wouldn't be enough people willing to pay $3 a month (or however much) to get the channel. Same thing with VH1Classic, Discovery Science, and many other niche channels that have some good programming. Ala carte means every channel must cater to the lowest common denominator, as they survive on getting as many people to order their channel as possible. That means lots of things like MTV and less things like SciFi.

Ala carte sounds great for my pocketbook, but I'm not willing to give up the good, niche programming that would die off to save a couple extra bucks a month.

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One problem with your argument: all of the channels you mention run COMMERCIALS. It already chaps my ass that I have to pay to watch a channel that runs COMMERCIALS, but since I have paid for DVDs that make me watch COMMERCIALS I have become inured to it.

The problem with ala carte

There is this little thing that some people like to refer to as "diversity". In some ways, it means catering to minorities and in others is means broader cultural vision.

Today, there is a cable/satellite channel dedicated to running old movies. How many people actually watch that enough to justify paying for such a channel? Damn few. How about a cable channel dedicated to television shows with Black actors? Today, there are more than one of these and considering both the number of people interested in such channels and their disposable income, it is doubtful that such channels would survive.

Sure, there would be plenty of people supporting the mainstream pablum that is on USA and FX. Movies with every questionable word silenced or redubbed. SciFi channel might survive, but it has a rather narrow appeal.

Unfortunately, the money required to operate an enterprise as a cable/satellite channel is pretty high. Today, if your offering gets picked up by cable systems you can operate and if not, every goes home to find something else to do. It isn't cheap to do this and it isn't going to be cheap in the future. This means that anything marginal or not clearly focused on the mainstream entertainment experience is going to go by the wayside.

I would miss the SciFi channel. I would miss TVLand and AMC (old movies). But my purchasing these channels on an ala carte basis would not be anywhere near enough to keep them operating.

Ala Carte is a method by which the larger media organizations get to push their message at everyone even more consistently than they can today. Anyone without a dedicated majority of the viewers loses. This has already happened with radio - there are few formats today and they all have mass appeal. Anything for smaller audiences is gone. Ala Carte cable will have exactly the same effect.

Re:The colors duke!

See, that's why ala carte is stupid, while those channels might be popular with slashdot, they are massively unpopular with the public at large. What this means is that they will be expensive. Right now the reason there are some geek friendly channels on cable is because they are subsidized by the popular stuff. If ala carte pricing ever happens, the only affordable channels will be the popular ones, and all the niche channels will cease to exist, or be prohibitively expensive.

Look people, ala carte might sound good, until you realize that in order to remain revenue neutral the people who watch the popular channels will pay less, and those who watch the more obscure stuff will pay more. And who are we kidding the cable companies aren't going to roll out a new pricing scheme that is revenue neutral, so in reality only those who choose the only the most popular networks will pay the same (and get less), and anyone who wants anything out of the ordinary (read: slashdot) will pay more.

Re:Goodbye to Small Channels?

I don't understand how these channels exist now, if that is the case. They must have enough people watching them to get enough advertising revenue to buy the shows they carry. With an a la carte system, there is nothing stopping channels like this from being offered for free to cable companies.

In fact, it's slightly perplexing how channels get away with charging cable companies to carry them; they make money through advertising, and the more viewers they have, the more money they can make this way, yet they also charge cable companies to increase their potential viewership.

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And, in fact, it may even improve the situation for smaller channels. Because people elect to get these channels, and specifically pay for the privilege of doing so, they have overtly expressed an interest in that channel's content. A little research and