[opendtv] Re: Analysis: The Ala Carte Part

John Shutt wrote:

> I predict the opposite effect. Ala Carte will result in fewer
> channels being offered, not more channels. Current business models
> of Cable and DBS are such that networks such as Discovery can offer
> 5 channels because they get 5 subscription revenue streams from all
> subscribers. How many channels will Discovery be able to offer if
> they only get one or two subscription revenue streams on average
> from each subscriber? And if you think that the "per sub" fee will
> increase with Ala Carte, the public isn't foolish enough to end up
> paying the same amount for what they perceive as fewer channels,
> even if they are channels they'll rarely or never watch.
>
> Ala Carte can have many unintended consequences, and most likely
> will not achieve the intended one (which is to lower the
> subscriber's monthly bill.)

I agree. My bet is, and has been, that the average monthly bill will *at
very best* be no higher than what the average subscriber pays now. That
assumes that added admin costs are $0. The highest fees paid will be
higher, and the lowest will be lower. It would just be a way to make
cable subscription fees more "progressive," like the income tax.

The causes are (a) that the cost of keeping the infrastructure going
will not decrease by a dime, and (b) that content creators will end up
charging more for their most popular content, and take a loss, or just
drop, in the unpopular stuff that no one wants.

Bert
 
 
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