You'll Never Get Cable à la Carte
Cable TV is like a crappy pizza joint: You can order a small, medium, or large pie, but you can't design your own - and no slices. Put off by increasing cable TV fees, US senator John McCain aims to introduce legislation to force providers to offer an à la carte menu as a way to rein in monthly bills and expand subscribers' choices. We asked Time Warner Cable chair and CEO Glenn Britt to get in front of any regulation and give his customers the option now.
WIRED: You're already giving us video-on-demand and DVRs. Isn't à la carte cable TV the logical next step?
BRITT: À la carte is really a step backward - you would end up with a lot less choice, less diversity. People like having maximum choice. We carry many channels that appeal just to niche groups and minorities. It's by no means clear those could survive in an à la carte regime.
So those channels aren't really supported by the marketplace. If I could pay for just the channels I want, I'd be a lot more valuable to advertisers.
Cable isn't about having a few channels that appeal to everybody, it's about having a lot of channels that appeal to everybody. You may not watch C-Span every night, but it's good to know it's there.
Sure, good for C-Span and Time Warner. But as a consumer, I'd rather lower my bill by paying for only the channels I actually watch.
The myth is that if you pay $60 a month and get 100 channels, then you could buy 50 and cut your price in half. That isn't how the economics work; there are a lot of fixed costs. You'd most likely end up with people paying the same amount of money for fewer channels. It's analogous to a newspaper or magazine. Hardly anybody reads every article in the paper; you read selectively. But nobody says, "Gee, you should only buy the sports section if that's all you want."
Cable and satellite are in cutthroat mode. Couldn't à la carte be an opportunity for you to differentiate Time Warner Cable from its competitors?
If that's what people wanted, yes. But the assumption is wrong. Every time we've tried to offer more packages with fewer channels - more toward à la carte - consumers always went for the big packages. People actually like this service, which is why 90 percent of the homes in the country buy it.
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WIRED: You're already giving us video-on-demand and DVRs. Isn't à la carte cable TV the logical next step?
BRITT: À la carte is really a step backward - you would end up with a lot less choice, less diversity. People like having maximum choice. We carry many channels that appeal just to niche groups and minorities. It's by no means clear those could survive in an à la carte regime.
So those channels aren't really supported by the marketplace. If I could pay for just the channels I want, I'd be a lot more valuable to advertisers.
Cable isn't about having a few channels that appeal to everybody, it's about having a lot of channels that appeal to everybody. You may not watch C-Span every night, but it's good to know it's there.
Sure, good for C-Span and Time Warner. But as a consumer, I'd rather lower my bill by paying for only the channels I actually watch.
The myth is that if you pay $60 a month and get 100 channels, then you could buy 50 and cut your price in half. That isn't how the economics work; there are a lot of fixed costs. You'd most likely end up with people paying the same amount of money for fewer channels. It's analogous to a newspaper or magazine. Hardly anybody reads every article in the paper; you read selectively. But nobody says, "Gee, you should only buy the sports section if that's all you want."
Cable and satellite are in cutthroat mode. Couldn't à la carte be an opportunity for you to differentiate Time Warner Cable from its competitors?
If that's what people wanted, yes. But the assumption is wrong. Every time we've tried to offer more packages with fewer channels - more toward à la carte - consumers always went for the big packages. People actually like this service, which is why 90 percent of the homes in the country buy it.
SOLOEnterprises is your one stop shop for computer consulting in Orange County, web site design and web site hosting.
Remember our motto "We Speak YOUR Language"
Computer Service Orange County
Webdesign Orange County
Web Hosting Orange County
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