# What Are Consumers Saying About a la Carte?



## Chris Blount (Jun 22, 2001)

Consumers are getting into the debate surrounding a la carte programming options.

In comments and letters that have been filed at the Federal Communications Commission this summer on the subject, consumers are backing support for program choice. A lot of the correspondences represent the one that came from Jesse Stinson of Lynn Haven, Fla., who said that out of 60-plus channels his family receives the household occasionally watches no more than 10 or 12 networks, and that "We don't care a plug nickel for the rest of them," he said.

A la carte programming, Stinson said, "Would be a tremendous option for us if the costs were not prohibitive. I believe in the free market. I think programming providers should be required to let the public determine whether or not their channels are carried or cut."

C. Archer Woodward of Winsted, Conn., said it's "utterly ridiculous that I am forced to accept a package of 72 channels for $54 when I abhor several of them, think several are immoral and should have restricted broadcast." Woodward said he would watch only about 15 channels, and about five on a regular basis. "A la carte or something close should be implemented immediately," Woodward said.

Elizabeth Armenta of Dallas said she won't buy cable service "because of the horrible, unregulated content on some channels that I refuse to have in my house with my children." However, Armenta said there are a handful of channels she would pay for if she had the option and if they were not outrageously priced.

The FCC is taking comments on a la carte issues for a report it will submit to Congress this fall.

http://www.skyreport.com (Used with permission)


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## lionsrule (Nov 25, 2003)

I love the fact that the FCC seems to be using examples of the far right wing, christian cult's cries over immoral programming. That's hilarious. I'll be happy to hide behind there cries if it get's alacart to pass. I'd love to hand pick about 8 channels for half the price. It's too bad that it takes the untouchable shield of cries over morality and "being bad for my children" to get congress to ALLOW us to pay for only what we want.


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## scottchez (Feb 4, 2003)

In each case they say if cost are not high.

With out the volumn packaging the channel cost would be very high. Today the costs are averaged out so we all pay about 30 cents per channel, with over 10 Million doing this the cost is so small.

Ala carte pricing without the 10 Million+ volumn purchasing 
===============================
ESPN would be $5

USA would be $5

CNN & Turner $5

Fox ALL $5

NIC $5

USA NBCs $5
======================
$30 same as price of basic package 


The cost for the 15 or so channels that everyone wants would be the same as what we pay now but with only 1 /30th of the the channels.


Congress would have to set fixed pricing to make it work, like $1 a channel.


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## Link (Feb 2, 2004)

I agree with the a la carte. I only watch probably 5-10 satellite channels, the rest are local stations. I don't see paying $50 a month for a bunch of extra channels I never even turn on.


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## Chaos (Apr 24, 2002)

a la carte is the worst idea that anyone ever had. Just unbundle the broadcast networks from "cable" channels and be done with it. Without group packaging, we'd never have the vast majority of channels we have today and TV would have become completely stagnant.


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## scottchez (Feb 4, 2003)

" $50 a month for a bunch of extra channels I never even turn on."

But the point is you would be paying more than $50 for the few channels you want to watch.

You would loose 10 Million Plus Customer Volumn discounts.


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## GADAWG (Dec 7, 2003)

scottchez said:


> " $50 a month for a bunch of extra channels I never even turn on."
> 
> But the point is you would be paying more than $50 for the few channels you want to watch.
> 
> You would loose 10 Million Plus Customer Volumn discounts.


 I use to pick so many channels for a fixed price with an old c band sat. It worked then why couldn't work now?


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## Ray_Clum (Apr 22, 2002)

DTV & Dish would still have TC and AT# respectively (to offer a bundling discount - a la telecom), but would be $5 for ESPN, $5 for ESPN2, $2 for Lifetime, $.01 for QVC. They could just price the top 5-10 channels up so high that it would be stupid to go away from the bundled pricing...


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## jdspencer (Nov 8, 2003)

I agree that a la carte just won't work because of the bundling. But, I'd like to have more choices of what bundles I'd like to subscribe to. With DirecTV Total Choice, Total Choice Plus and Premier just isn't enough choice.


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## durl (Mar 27, 2003)

lionsrule said:


> I love the fact that the FCC seems to be using examples of the far right wing, christian cult's cries over immoral programming. That's hilarious. I'll be happy to hide behind there cries if it get's alacart to pass. I'd love to hand pick about 8 channels for half the price. It's too bad that it takes the untouchable shield of cries over morality and "being bad for my children" to get congress to ALLOW us to pay for only what we want.


Just making sure I'm up on my definitions here: "far right wing" = anti-communist. i.e. Anyone who disagrees with the far LEFT wing (socialists/communists)

So...which other groups do you wish would keep their mouths shut and let the other people run things?  Sorry...not trying to stir controversy here. Just trying to stress the point that ALL Americans have a say in what happens in government...regardless of whether you agree with them or not. Ain't a republic grand?

I wish ala carte would work as well, but I have my doubts that we'll see it any time soon. There's a LOT of channels out there that I've never watched and probably never will and I don't like the idea of paying for them.


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## Nick (Apr 23, 2002)

I just subscribe to everything, including all four movie packs and watch what I want when I want. Most likely a lot cheaper than the great diversity of channels I mostly watch, if they were priced ala carte.

_"Be careful what you ask for, you just might get it!"_


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## Chris Freeland (Mar 24, 2002)

Sure their are probably 12 -15 channels that I watch on a regular bases, however I tend to scan all or most of the channels on either the epg or brouse when I sit down to watch TV and every now and then I find a gem of a show on one off the channels that I never watch, so I sub to AT180/Supers/KCBS and KNBC because I like to have a big choice. Also, even the channels that I watch frequently changes their schedule from time to time and some my 12 - 15 channels will change from year to year and sometimes E* may add a new channel that might become a new favorite as well, with "a la carte" I would be stuck paying for those same un changing channels and probable be paying almost as much as I am paying now.


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## jrb531 (May 29, 2004)

I keep hearing about how we save by "volume" pricing. Why?

Do the stations share equipment? Do they share the techs that run the stations? Do they share anything aside from the same owner? 

Would some stations go belly up if they were forced to stand on their own? Yes and what's wrong with that? If the public does not like a product it goes the way of ther do-do.

Can anyone explain why costs would go up aside from maybe some added costs for managing the separate subscriptions?

Packages help the big companies who own the stations and nothing more. This is why they are fighting this so bad.

If I pay $50 a month for $50 channels ($1 each) and ala-cart allows me to pick what I want for $3 each channel (triple the costs) and I only watch 10 channels I still save $20 a month to dump the crap I don't want.

Years ago with analog their was a technical reason for packages but with the advent of digital systems there is no reason in the world to "force" people to pay for "any" channels they do not want aside from the "business as usual" and "fear of change" along with the current system being good for big business and NOT the consumer.

If ala-cart was good for these huge companies that we would have had it years ago.

Why should ANYONE be "forced" to pay $5 a month (average costs for any package with ESPN) for ESPN if they do not watch sports? That's $60 a year wasted.

I guess I'm just sick and tired of the lame excuses. Sure if these companies are forced to offer ala-cart and are allowed to charge whatever they want costs can go up but we're not that stupid. Make them offer ala-cart "and" justify what they charge and this will work.

The vast vast vast majority of the country wants ala-cart if it results in real choice and fair costs no matter that the boogie men and company plants here want to say about it. Maybe those against this are afraid that if this goes through then they might lose their fishing channel type channels that prob would not have enough subscribers to sustain it if the rest of us were not forced to pay for it.

Maybe the HBO's who offer 10 channels with identical programming would be forced to lower costs if we could subscribe to only one HBO instead of the entire package. With the advent of PVR's there is little reason these days to have 10 channels with staggered programming when we can just record what we want when it is on that one channel.

This is win win win for the consumer which is why the big companies are going to fight tooth and nail against this.

This is all about $$$!


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## Nick (Apr 23, 2002)

jrb531 said:


> I keep hearing about how we save by "volume" pricing. Why? Do the stations share equipment? Do they share the techs that run the stations? Do they share anything aside from the same owner? Would some stations go belly up if they were forced to stand on their own?...


In the industry, "stations" refers to broadcasters. When referring to non-broadcast programmers, you can say "channels" or "content providers".



> The vast vast vast majority of the country wants ala-cart...


  How do you _know_ this? Can you provide a credible source for this information, or is it just your opinion and you assume that the _"vast vast vast"_ majority of the country thinks just like you? Frankly, I don't think the majority of the country gives a rip. I doubt ala carte is being discussed around the water cooler or at PTA meetings.



> ...This is all about $$$!


Of course it is. Isn't everything? I don't know what you do for a living, but would you do it for free, or even half of what you earn now? Complaining about it being about the money is really pointless unless you are an anti-capitalist, and futile regardless. :shrug:


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## DonLandis (Dec 17, 2003)

a la carte only makes sense if they keep the current bundles and then offer some of the key channels that are only offered in the top bundles- a la carte.

This would allow you to add that one special channel without needing to buy the big bundle. 

In this way they could increase revenues. All total - a la carte would do would kill off many small channels and reduce the variety of choice for the same or more money.

What do you want-
75 channels in a bundle for $50
+ 2 a la carte channels for $3 ea.
Total $56

or,

18 a la carte channels for, total $56


To get those special 2 channels in the current system you need to sub to the "everything pack" at:
125 channels for $99


Splitting off HDTV in some HDTV pack is in a way, the direction of a-la carte with bundles. 

Also, since some of us do have a customizable pack with DirecTV now just for the asking (over and over and over again) they really should make this a part of their standard offering and not just something they do for a few.


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## Greg Bimson (May 5, 2003)

jrb531 said:


> This is all about $$$!


Duh!


> I guess I'm just sick and tired of the lame excuses. Sure if these companies are forced to offer ala-cart and are allowed to charge whatever they want costs can go up but we're not that stupid. Make them offer ala-cart "and" justify what they charge and this will work.


This isn't socialism; these companies don't have to justify anything. This is capitalism at its best.

The multi-channel distributors (cable and DBS companies) are the ones that create these programming packages. The pricing from the programmers is based upon the number of subscribers in a given package. If people do not take a package, then those people will pay through the nose for the same channel in order to make up for lost subscrber revenue and lost advertising revenue. Some channels will go under.


> The vast vast vast majority of the country wants ala-cart if it results in real choice and fair costs no matter that the boogie men and company plants here want to say about it.


Says who? We keep getting back to these "fair costs". It is everywhere in the FCC filings.

Keep in mind a "fair cost" for ten channels may be more expensive than buying a pre-packaged unit of 60 channels.


> Maybe the HBO's who offer 10 channels with identical programming would be forced to lower costs if we could subscribe to only one HBO instead of the entire package.


More like buy one, get nine free. HBO is not subsidized by advertising. It is a premium package. And this is the kind of pricing you'll see for a la carte if it ever comes to pass. HBO, in most cases, gets a 50 percent take from distributors for each subscriber to the service. One channel will never be a buck and a quarter.

So, besides the programmers, do you think the distributors want a la carte either?

There may be five percent of the population that wants a la carte. There may be sixty percent of the nation that wants a la carte. And when it comes time to pick the programming and cost justify it to each individual household, you'd be lucky if two percent goes for a la carte. Mark my words.


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## jpurkey (May 15, 2003)

They should continue to bundle the channels that do not have a high per-subscriber cost, which would include the free and paid to be carried (shopping) channels. However, any channel that wants more than say 25 cents should be offered a la Carte. Such a system would protect the niche channels while the more expensive channels could decide how they want to price themselves to maximize their subscriber count.

I really don't mind paying 5 or 10 cents each for channels I never watch and I'm willing to do so to prevent them from going away since I know there are channels I watch that others don't and it all balances out. It is paying $1+ for channels I never watch (ESPN and Disney for example) that bothers me.


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## jrb531 (May 29, 2004)

"IF" (and yes this is a big if) they forced them to offer ala-cart

"AND"

At the same time they were forced to charge a fair price (IE not "punish" people for not taking the package)

"THEN"

Who still does not want ala-cart?

I still do not buy the deal we are getting with a package. Why would they offer us a deal if they did not have to?

As far as HBO goes.... think of the expense, wasted bandwidth and equipment that we have to pay for by having 10 channels of the same staggered programming so that Buy one get 9 free is not accurate.

Sure the cost is less as we are really paying for only one set of programming for all 10 channels but I still think that you could save significant $$$ by only subscribing to 1 channel of HBO instead of 10. I know it's not a 1 for 1 but if I pay $12 for 10 channels I would be very happy to pay $8 for 1 channel as those extra 9 channels do nothing for me as I'll record whatever I want on HBO on the PVR.

As far as what the "majority" of people want (majority being 51+%) of course I expressed my opinion as I (and everyone else) have no idea what people want but I see it two ways...

1. Offer ala-cart as an option which will raise the bills for those who want packages (less subscribers = less advertising = more cost) and lower bills for those who do not want packages.

2. Leave thing as they stand and continue to watch rates go up and up and up and up

An alterative solution would be to not offer ala cart but offer more, smaller packages that you can pick and choose. Let's call this "ala-cart light" in which you would have maybe 10 mini-packages instead of the average 3 basic packages. 

Example:

Sports1 (Non-ESPN channels)
Sports2 (ESPN)
Basic1
Basic2
Basic3
Basic4
Basic5

You get the idea but aside from leaving it the way it is... how would you recommend we fix the current situation and allow people NOT to have to pay $5 a money for ESPN and other "expensive" channels?


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## Nick (Apr 23, 2002)

I have no problem with ala carte as long as it's voluntary and not mandated by the FCC or the courts. But, you haven't convinced me that the "current situation", as you say, needs fixing.

If ESPN is priced to the subscriber @ $5-$10/m and some people want to pay that much, more power to them.


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## jrb531 (May 29, 2004)

ESPN costs an average of $5 per subscriber for their channels.

I cannot drop ESPN as it is a part of a package that I want. I agree with the post above. If all the expensive channels were ala-cart and the cheap channels part of packages then I would be fine but making me pay for "premium" channels by adding them to basic packages is not right IMHO.

Why not add HBO to "all" pachages and raise the rates to cover this? This is, in effect, what they are doing when they force people to pay for ESPN or Disney as part of the basic packages.


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## SimpleSimon (Jan 15, 2004)

What jrb531 said! I watch a fair chunk of sports, but (almost) never on ESPN. I'd drop it in a NY second to save $5/month.


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## sampatterson (Aug 27, 2002)

We watch about 15 different channels, but we are required to have the top package because those channels aren't in the lower tiers.

I look forward to a couple of years from now where you'll be watching ala-carte or on demand programs through the internet, instead of relying on traditional cable or satellite. You won't need dish or comcast (unless they are your broadband provider) and you'll be paying HBO directly without the added cost of the middle man.


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## SuperJack (Jul 6, 2004)

Reading these posts is giving me headache. Really, what are the programmers afraid of? I don't want most of the channels that are in the TC package. If I only select the 10 or so that I want, I would expect it to save me money -- if only a few dollars. I imagine that these cable networks and their owners are in high gear figuring out how they can make up lost revenues if this a-la-carte thing passes. Let me give them a start: cut channels. It upsets me to think I may be paying $5/month for Nickelodeon so that MTV2 can survive. Growing up my parents had c-band, and a-la-carte was how many providers offered service. None of the channels then were outrageously priced. I remember ESPN costing about $2.00, while USA might be $1.50. Maybe a network like Discovery would only be $.75 or $1.00. This was in the early 90s, not 1975. I don't understand why something similar can't be implemented now. The FCC should investigate how this was done and why cable rates have increased so much in the past decade. Enough is enough. I don't watch $75 or $100 dollars worth of TV per month. In fact, if prices get too much more out of hand, I'll go back to the days of free network TV.


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## lifterguy (Dec 22, 2003)

Those who say "let the free market decide" this issue are missing a key point:
Even if cable systems or satellite services want to offer ala carte, they are unable to at this time because the major content providers will not allow it. ABC-Disney requires that ESPN be included in all but the most basic packages. And as we have seen in recent Dish Network negotiations, the providers use the "all or nothing" tactic to make sure providers bow to their demands at the bargaining table. If the FCC simply barred the content providers from having any say in how their channels are bundled or the price charged for those channels, it would give the distributors (cable and satellite) new flexibility to create a variety of lower cost package deals and shift channels that have become over priced (ESPN being the prime example) to ala carte status. I believe the biggest loser in this would be any channel that spends too much on programming, and that would particularly impact channels that have paid huge premiums to gain rights to basketball, baseball, football and other major sporting events. I'm not sure ala carte pricing would significantly lower bills for most viewers who want a wide choice. But I don't buy the argument that it would mean fewer channels to choose from. First, there are currently many more programmers vying for for space on cable and satellite than there is space to carry them. Second, take a look at the magazine industry. Magazines have always been sold "ala carte" with a wide variety of prices for a subscription, but magazines have thrived, with hundreds of different titles available, catering to every niche market you can think of. If I subscribed to a hundred different magazines, it would be very expensive, but it's not all that expensive to get the 4 or 5 I really want.


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## jrb531 (May 29, 2004)

in offering both ways?

Unless, of course, someone has something to be afraid of.

Packages should save you $$$ and you would have to decide if the savings is worth having to pay for channels you do not watch.

This entire package thing is a dinosaur left over when the cable companies had primitive (by today's standards) boxes that only had a limited number of scrambling methods and all channels had to fit in one of maybe a half dozen methods.

Now that we have digital boxes that, technically, you can turn on and off every channel as your wish there is no need to group everything.

So why is everything grouped? $$$ and not $$$ on the consumers behalf.

People worry about losing their favorite "fishing" channel (for example) but those channels cost but pennies per month so package all of those together. It's the "strong-arm" tactics of the HBO's, ESPN's etc... that require the "all or nothing" approach.

Why can't I subscribe to ONE channel of HBO if I want? I do not want 10 channels of HBO or Showtime etc... and while I understand that the channels share programming I would guess that I would not have to pay $13 a month for one channel.

Think of the wasted bandwidth of all those pay channels with, in essance, do nothing but show the same staggered programming.

In the day of the PVR it just does not make sense and while not everyone currently has a PVR I envision the day in which all cable/dish boxes have it. There is little reason not to since the price of hard drives is so cheap these days.

My dream is to be able to subscribe to one channel of HBO, one channel of Showtime, one channel of Cinemax etc... and pay $5 for each channel. My bill would not go up because I would cancel ESPN, Disney and other unwatched junk that I am forced to pay for now.

Now having only one channel of each would limit my "live" viewing habits but I NEVER watch live TV anymore. I record everything and watch it when I want with my PVR's so it matters not when the show is on. Now if something is showing at the same time I am stuck (I do have 2 PVR's thou) but the future will be with the two tuner PVR's and within a few years, IMHO, all boxes will be two tuner PVR's.

The only reason people do not insist on PVR's now is ignorance of new tech. One people are exposed to a PVR they will never go back


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## SimpleSimon (Jan 15, 2004)

What jrb531 said - again!


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## SAEMike (May 29, 2004)

SimpleSimon said:


> What jrb531 said - again!


I second that statement


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## Mike123abc (Jul 19, 2002)

What I would like to see is how Cband works (or used to). You could buy packages from different providers if you want. It would be up to the provider to decide if they can do more with a few small packs (like Disney Kids, and ESPN sports) or try to force all their channels together (like you either buy all the ABC/DISNEY/ESPN channels or none). I suspect most of the big conglomerates would price small packages.

What it really should be is that providers cannot insist that their channels have to be bundled with different provider's chanels. For example ABC/Disney cannot insist that if someone buys Viacom's Nicolodeon line they have to take the ABC/Disney line.

The big providers can still bundle. Viacom could say if you want to sub to nicktoons you have to take all Viacom's channels for $XXX. But, it would be them not the carriers that take the heat from consumers and suffer the lost revenue by pricing themselves out of the market. If they want to push a channel they could bundle it free as long as they want until they decide it would sell itself.

The only real problem between the carrier/provider would be if the provider wants the carrier to carry more channels. The provider would have to give incentives to the carriers.


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## SimpleSimon (Jan 15, 2004)

_"The provider would have to give incentives to the carriers."_

I LIKE that idea!


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## redfishhunter (Aug 5, 2004)

How do you know this? Can you provide a credible source for this information, or is it just your opinion and you assume that the "vast vast vast" majority of the country thinks just like you? Frankly, I don't think the majority of the country gives a rip. I doubt ala carte is being discussed around the water cooler or at PTA meetings.

I am a E* and DTV dealer and have tech. in the field. Let me tell you Yes people in the community talks about it . I would dare to say 2 out of 3 ask why can't they choose the programming they want. and they have read in local newspaper or heard of a la carte...


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## mrschwarz (May 8, 2004)

I agree with LifterGuy. The only thing is I don't think one channel of HBO would be sold for any less that all of the other channels. Most of the cost is for the programming, not the channels.


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## audiomaster (Jun 24, 2004)

I would like to see it taken one step further. lets not have any packages and we will pay by the program! If I want to watch CNN I'll pay a small per hour charge, If its a movie, it will be by the movie and a larger charge. major sporting events will be more yet. I will pay for all programming I watch or tape unless the receiver is on the guide or a preview channel. If they don't have any packages, the networks can't force them to be included in them!
And if we are going to have packages, how about a low cost senior citizens package, and an educational package for parents with kids in school? 
I don't watch sports, and am tired of paying for them.
And why are the X rated movies more that first run movies? Surely they cost less to make?


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## dswallow (Mar 31, 2003)

I believe the only way alacarte pricing can work is if there's a separation between the carrier, the programmer, and the sales agent. This would permit different sales agents to negotiate to resell combinations of channels provided over whatever carriers.

Without the competitive environment of such a separation, there's not much likelihood of containing costs, which seems to be the focus of the alacarte movement.

I can't otherwise see how anyone could come up with a way to require alacarte channel subscriptions that wouldn't be at a significant price disadvantage.

With commercially supported programming, the programmers want access to the subscribers; without subscribers having access they have ZERO chance of attracting them to their programs.


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## Ray_Clum (Apr 22, 2002)

I personally perfer package pricing. The reality is that I have seen some fantastic shows on channels that I would have never watched (some on DIY or Bravo) and have caught some shows in syndication that I have missed from the past (Battle of the Network Stars on Trio) on channels that I would have never watched.

But, YMMV.


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## jpurkey (May 15, 2003)

Ray_Clum said:


> I personally perfer package pricing. The reality is that I have seen some fantastic shows on channels that I would have never watched (some on DIY or Bravo) and have caught some shows in syndication that I have missed from the past (Battle of the Network Stars on Trio) on channels that I would have never watched.


That is fine for most channels, but when it is an expensive channel like ESPN (about $3 per subscriber from what I've read) then i don't like paying for it. In two and a half years I've paid $90 just for that one channel that I never watch.


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## Greg Bimson (May 5, 2003)

jpurkey said:


> That is fine for most channels, but when it is an expensive channel like ESPN (about $3 per subscriber from what I've read) then i don't like paying for it. In two and a half years I've paid $90 just for that one channel that I never watch.


_YOU_ have not been paying for ESPN. You have been paying your DBS company for a package of channels. It doesn't matter that ESPN is charging *the DBS company* darn near $3 per month per subscriber.

Here. You guys want proof about a la carte? Let's take the NFL Sunday Ticket thing. New customers this year will pay $219 for Sunday Ticket, for all 17 weeks. That averages out to $14.65 per week.

There is a way to order Sunday Ticket weekly. Is it $14.65 a week? Last year, it was $39.95 per week. That is a 173 percent markup.

Is that a "fair price"? Who knows. I can tell you this much: a la carte will not move more expensive channels out of a package, but you may be able to create your own package. The problem becomes that a la carte pricing to create your own package of channels will end up more expensive, in the long run.

All of you for a la carte, give yourself an idea of what commerical rates are. Try this.


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## SimpleSimon (Jan 15, 2004)

Well, this PDF: https://rweb.echostar.com/commercial/forms/MDUBulkRateCard.pdf might add some insight to the discussion.

Note that there's probably a base charge per drop, so don't get all excited, but this is still interesting reading.


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## BabaLouie (Apr 2, 2004)

The programming options available from D* and E* are the way they are because those providers have decided that they want to get a minimum of X amount of $$ from each subscriber. 

For example, E*'s Top 60 isn't priced at $24.95 because E* said, "Let's see, ESPN is worth $3 a month, and USA is worth $1.00 a month, and QVC is worth $.02 a month," and so on, adding the values of all 60 channels to come up with a figure of $24.95. Rather, E* decided, "We want to get no less than $24.95/month from each subscriber. How can we do that, and make the biggest possible profit in the process?...Hey, let's give 'em about 10 channels that they really want, and then we'll throw in about 50 more that most folks don't give a rip about--but they will see that they are getting 60 channels for $24.95, and willingly pay it, thinking they are getting a good deal."

Don't try to feed me the line that E* and D* can't do a-la-carte, or that it would force the costs to be outrageously high. When I started with E* back in 1996, they had a programming option called "DISH PIX", where you could pick 10 channels for a dollar apiece, including channels such as ESPN, ESPN2, CNN, TCM, TBS, TNT, etc. For $10/month, I got 10 channels that I wanted. If they did that back then, there's no reason they couldn't do it again--pick 10 channels for $20/month or less. At least they could offer more options, more programming tiers, such as ExpressVu in Canada offers.

As I see it, the major obstacle right now to more choice is GREED. The earlier poster has got it right--when more options are offered via Internet, etc., these satellite and cable providers will finally be FORCED to change. For now, they really don't have the competitive incentive to do that. As long as they can, they'll gladly keep taking your money and laughing all the way to the bank.


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## BabaLouie (Apr 2, 2004)

lifterguy said:


> Those who say "let the free market decide" this issue are missing a key point:
> Even if cable systems or satellite services want to offer ala carte, they are unable to at this time because the major content providers will not allow it. ABC-Disney requires that ESPN be included in all but the most basic packages. And as we have seen in recent Dish Network negotiations, the providers use the "all or nothing" tactic to make sure providers bow to their demands at the bargaining table. If the FCC simply barred the content providers from having any say in how their channels are bundled or the price charged for those channels, it would give the distributors (cable and satellite) new flexibility to create a variety of lower cost package deals and shift channels that have become over priced (ESPN being the prime example) to ala carte status. I believe the biggest loser in this would be any channel that spends too much on programming, and that would particularly impact channels that have paid huge premiums to gain rights to basketball, baseball, football and other major sporting events. I'm not sure ala carte pricing would significantly lower bills for most viewers who want a wide choice. But I don't buy the argument that it would mean fewer channels to choose from. First, there are currently many more programmers vying for for space on cable and satellite than there is space to carry them. Second, take a look at the magazine industry. Magazines have always been sold "ala carte" with a wide variety of prices for a subscription, but magazines have thrived, with hundreds of different titles available, catering to every niche market you can think of. If I subscribed to a hundred different magazines, it would be very expensive, but it's not all that expensive to get the 4 or 5 I really want.


Good points.


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## jrb531 (May 29, 2004)

BabaLouie said:


> The programming options available from D* and E* are the way they are because those providers have decided that they want to get a minimum of X amount of $$ from each subscriber.
> 
> For example, E*'s Top 60 isn't priced at $24.95 because E* said, "Let's see, ESPN is worth $3 a month, and USA is worth $1.00 a month, and QVC is worth $.02 a month," and so on, adding the values of all 60 channels to come up with a figure of $24.95. Rather, E* decided, "We want to get no less than $24.95/month from each subscriber. How can we do that, and make the biggest possible profit in the process?...Hey, let's give 'em about 10 channels that they really want, and then we'll throw in about 50 more that most folks don't give a rip about--but they will see that they are getting 60 channels for $24.95, and willingly pay it, thinking they are getting a good deal."
> 
> ...


Why a few months back did Dish have some big fight with one of the companies that wanted to force Dish to add channels or they would not allow them to carry the popular ones?

It seems that these huge companies hold us hostage by saying.... well if you want your local channel you will have to carry this or that channel.

I understand that Dish could prob offer more packages if they wanted but I wonder how many strings are attached to these backroom deals the big comapnies use. I have never watched MTV or the other music video channels. Why can't I cancel them? Is it because Dish says no or Dish has to put them in the package or they can not offer other channels that we do want?


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## Mike123abc (Jul 19, 2002)

Greg Bimson said:


> All of you for a la carte, give yourself an idea of what commerical rates are. Try this.


Why not look at real a la carte package pricing?

http://skyvision.com/programming/alacarte.html

C-band has those today...

Here is another site with prices: http://www.callnps.com/alacarte.htm


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## Ray_Clum (Apr 22, 2002)

BabaLouie said:


> Don't try to feed me the line that E* and D* can't do a-la-carte, or that it would force the costs to be outrageously high.


Actually, yes, currently they cannot do a la carte. They have contractual obligations to place certain channels in certain packages. These contracts preclude a la carte. You won't see a la carte offered until either those contracts expire or Congress & the courts declare them null and void.



BabaLouie said:


> As I see it, the major obstacle right now to more choice is GREED.


Nope, see above.


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## Greg Bimson (May 5, 2003)

Because if C-band (and by extension, a la carte) was so popular, the C-band base would have been growing over the past decade. Instead, C-band is no longer commercially viable, and is almost extinct.


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## Mike123abc (Jul 19, 2002)

Greg Bimson said:


> Because if C-band (and by extension, a la carte) was so popular, the C-band base would have been growing over the past decade. Instead, C-band is no longer commercially viable, and is almost extinct.


A la carte popularity and C-Band are 2 separate things... Cband costs thousands to have installed, has the ability to feed 1 TV, you have a huge dish in the yard, you had to have line of site for this huge dish over a large section of the sky, you had to wait for it to move to change channels. You are dreaming if you think a la carte is what killed C-band...


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## SimpleSimon (Jan 15, 2004)

Correct - C-Band is, from the consumer's standpoint at least, obsolete technology.

As for DBS a la carte, yeah - it's the existing contracts, but Congress can pass legislation prohibiting renewal of forced packaging.


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## Chris Freeland (Mar 24, 2002)

Mike123abc said:


> A la carte popularity and C-Band are 2 separate things... Cband costs thousands to have installed, has the ability to feed 1 TV, you have a huge dish in the yard, you had to have line of site for this huge dish over a large section of the sky, you had to wait for it to move to change channels. You are dreaming if you think a la carte is what killed C-band...


I suspect if Congress ever passes an "a la carte" law, most of us will still have a base package. Satellite providers will likely still require a basic package to got discounted, Free or Free rental or even rental on equipment, some of us might be able to get AT60 or TC and add 1 or 2 channels from larger AT120, 180 or TC+ packages possibly for $2 or more for each, however the pricing will be such that any more then a 1 or 2 channel addition(s) would be cheaper to simply go with the bigger package. Also I suspect the big multi-channel program providers will charge a high price for their more popular channels and then through in their less popular channels in for Free If you sub to the popular channel, similar to what the premium providers like HBO and Showtime do now. To get total 'a la carte' will require the purchase of satellite equipment and possibly cable equipment at an elevated full msrp. How much will a forced "a la cart" option rilly benefit consumers? The big conglomerates will find loopholes such as above and most people will still be forced into packages. Consumers will never see any real benefits from "a la carte".


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## BabaLouie (Apr 2, 2004)

Part of the responsibility no doubt lies with forced bundling, but it's hard to believe that part of the reponsibility doesn't lie with E* and D*. For example, if Viacom contractually forces D* and E* to carry NickToons, MTV, Noggin and TV Land along with Nickelodeon, then why can't D* and E* offer a 5-channel Viacom tier for, say, $7.00/month? If in order to carry ESPN, they have to carry ESPN2, ESPN News, ABC Family, and Toon Disney, then why not offer a separate tier with those channels for $9.00-10.00/month? You could have a Turner tier with CNN, Headline News, TNT, TBS, TCM, CNNfi for $10.00/month. How about a Fox tier with Fox News, a regional Fox Sports channel, FX, and Fox movies? I might choose two of those tiers, but I wouldn't want all four. Someone who wants all four could take one of the big bundles and get a bit of a discount.

I agree that the best situation would be an end to forced bundling. I'm writing to my congressman. Make everything available a-la-carte, and 
let the marketplace sort things out.


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## Greg Bimson (May 5, 2003)

BabaLouie said:


> Don't try to feed me the line that E* and D* can't do a-la-carte, or that it would force the costs to be outrageously high. When I started with E* back in 1996, they had a programming option called "DISH PIX", where you could pick 10 channels for a dollar apiece, including channels such as ESPN, ESPN2, CNN, TCM, TBS, TNT, etc. For $10/month, I got 10 channels that I wanted. If they did that back then, there's no reason they couldn't do it again--pick 10 channels for $20/month or less.


"...there's no reason they couldn't do it again--pick 10 channels for $20/month or less."

Maybe there is a reason they can no longer do this. Heck, I can think of two reasons...

Maybe a provider's contract with the distributor requires being available in the lowest tier, and Dish Pix is no longer the lowest tier.

Maybe the distributor does not want to offer a $15 package.

Don't forget there were restrictions on the channels that were available thru Dish Pix. The channels could only come from the AT40 package. That kind of limits the choice.


BabaLouie said:


> At least they could offer more options, more programming tiers, such as ExpressVu in Canada offers.


I could be wrong, but I believe that the packages on the Canadian DBS companies are mandated by Parliament and the CRTC. After all, since simsub is one of the "wonderful" covenants initiated by the CRTC, it wouldn't be a giant leap to believe the mini-tiers are also regulated.


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## BabaLouie (Apr 2, 2004)

Greg Bimson said:


> "...there's no reason they couldn't do it again--pick 10 channels for $20/month or less."
> 
> Maybe there is a reason they can no longer do this. Heck, I can think of two reasons...
> 
> ...


BINGO! I said as much...E* has decided they want no less than $24.95 a month rolling in from each customer. They don't want to offer a $15 package when they know there is no real competition that forces them to do that.



Greg Bimson said:


> Don't forget there were restrictions on the channels that were available thru Dish Pix. The channels could only come from the AT40 package. That kind of limits the choice.


I would be quite happy if I could pick any 10 channels from E*'s bottom AT package for $15. I'll bet there is a significant portion of consumers that would feel the same way.



Greg Bimson said:


> I could be wrong, but I believe that the packages on the Canadian DBS companies are mandated by Parliament and the CRTC. After all, since simsub is one of the "wonderful" covenants initiated by the CRTC, it wouldn't be a giant leap to believe the mini-tiers are also regulated.


It would be interesting to find out if this is the case. Does Star Choice offer the same kinds of mini-tiers and ala-carte offerings? If not, it's doubtful that the Canadian Government has mandated those options.

I imagine ExpressVu is making quite a healthy profit, even if their mini-tiers are government mandated.


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## Mike123abc (Jul 19, 2002)

If $25 or $30 is what Dish wants for minimum perhaps they could say AT60 (+locals) or pick channels off a price list, minimum package has $25 (or $30 if they want to force locals). You could pick the $4.50 ESPN pack or perhaps 3 other channels at $1.50 each, your choice, you just pick until you are equal to or over $25.

The channels do not need to all be the same price, instead they could all be different. The program provider could charge the DBS company what they want, and the DBS company marks up the channel as they feel they need to do. Perhaps DIRECTV adds $1 to every channel for their a la carte cut, and Dish undercuts them by only charging 95 cents!


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## Greg Bimson (May 5, 2003)

BabaLouie said:


> E* has decided they want no less than $24.95 a month rolling in from each customer. They don't want to offer a $15 package when they know there is no real competition that forces them to do that.


And maybe Dish Network will never recoup their investment in their new subscriber if they only take a la carte.

Dish Network spends on average of $550 to lure new subscribers to their platform. That $550 is called SAC, or Subscriber Acquisition Costs. It is one of the yardsticks measuring the health of the DBS industry. DirecTV's SAC is even higher, at $615.

For example, let's say a Dish Network subscriber is able to do a $15 a la carte package. In order for Dish Network to recover $550 from the new subscriber subscribing to only the Dish Pix package, it will take *36 months* to earn the $550 spent acquiring the subscriber. However, I didn't even include what Echostar would pay the programmers for their content over that 36 months.

Face it. The reason for "base packages" is to provide maximum profit to the distributors. The programmers then try to force their channels into specific tiers, in order to maximize profit.

If "a la carte" was ever mandated, pricing will go through the roof for any a la carte package. I've already given plenty of examples. Let me give you one more:

Dish Pix - any 10 channels from AT40 for $14.95.
AT40 - 40 channels for $19.95.

A $5 difference, for 30 channels.



BabaLouie said:


> It would be interesting to find out if this is the case. Does Star Choice offer the same kinds of mini-tiers and ala-carte offerings? If not, it's doubtful that the Canadian Government has mandated those options.


Link to understanding Star Choice's packages

From the link on Star Choice's webpage:

Pick 'n' Pay

Want to get a few more channels without paying for a whole bundle? There are almost 40 channels that you can add to your programming package in a bundle or one at a time.

You can pick The Biography Channel, National Geographic, Telelatino, the NHL Network and many more.

Why only some channels? It has to do with our broadcasting license. Canadian rules stipulate that some channels must be offered as part of a package. Most Pick 'N' Pay channels cost $1.99 per month.

[end Star Choice webpage]

Both Star Choice and Bell ExpressVu make the customer subscribe to a minimum package *before* any a la carte choices can be added.


> I imagine ExpressVu is making quite a healthy profit, even if their mini-tiers are government mandated.


Oh, I don't know. Dish Network and DirecTV are hardly making a profit, and both of those companies have two advantages: a much higher subscriber base and a strong dollar.

Both Star Choice and ExpressVu have less that 1.5 million subscribers each. Both companies are part of a much larger conglomerate, and do not break out their divisional numbers to a profit/loss for the unit.

And I will no longer go searching for information to refute some of these claims. This dissertation took me two hours.


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## SimpleSimon (Jan 15, 2004)

Mike: Quite logical - which means E* will never do it.


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## jrb531 (May 29, 2004)

It is for this reason that I want to be able to do ala cart. Right now I would take the lowest base package and add 2 channels to that but I'm forced to spend $10 to take the next package. 

The entire point of ala cart is to not drive the companies out of business but to allow us to subscribe to what "we" want and not be forced to take channels that we do not want.

Whatever the final business model they use to allow them to make a fair profit is fine with me as long as I do not have to pay for channels I do not watch.

As a side benifit from all of this.... I would "love" to see what the channels really cost me. Maybe I could live without some of these channels if I knew it costs 3x as much as other channels.

*** Maybe what they "really" fear is the competition that would ensue as people dropped expensive channels and went with the cheaper ones! ***

And that is exactly what would happen. Do you want ABC channel for $2 or DEF and XYZ for $2. While some channels are worth the extra $$$ others are not to some people.

This would foster tons of competition between the stations/channels that would try and keep the prices down to keep us as subscribers instead of the present situation in which the entire package goes up a few $$$'s and we have no way of knowing what we are paying for each channel and little recourse to do anything about rising costs as we are stuck with the present "take it or leave it"


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## jpurkey (May 15, 2003)

Greg Bimson said:


> If "a la carte" was ever mandated, pricing will go through the roof for any a la carte package. I've already given plenty of examples. Let me give you one more:
> 
> Dish Pix - any 10 channels from AT40 for $14.95.
> AT40 - 40 channels for $19.95.
> ...


It's still a $5 savings. It wouldn't matter to me how many channels I was getting or what I would be paying per channel. All that would matter to me is what my monthly bill would be to receive only the channels I watch.

I don't expect to save a bundle with a la caret pricing. $15 a month is just a dream in my opinion. However, if I could save $5 or even $10 a month it would be worth it, even if I only received a third of the channels I do now with Total Choice +.


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## jrb531 (May 29, 2004)

jpurkey said:


> It's still a $5 savings. It wouldn't matter to me how many channels I was getting or what I would be paying per channel. All that would matter to me is what my monthly bill would be to receive only the channels I watch.
> 
> I don't expect to save a bundle with a la caret pricing. $15 a month is just a dream in my opinion. However, if I could save $5 or even $10 a month it would be worth it, even if I only received a third of the channels I do now with Total Choice +.


Exactly!

What good are channels you do not watch no matter how "cheap" they are? Just to be able to brag about how many channels you have?


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## dswallow (Mar 31, 2003)

The concept is that getting 30 more channels for $5 more is that you might find a program occasionally among those channels that you have an interest in; and it's just $5 more for the opportunity. And the programmers want viewers, so there's encouragement to provide channels in blocks like this. If you don't get the channel at all, you cannot be a viewer. If you get it, even if you don't really want it, there's always that chance to grab your attention.

If too many people opt out of certain channels, the cost of those channels still has to be paid, which means the per-subscriber rate would have to increase to cover those costs (or other changes would have to get made), and in the long run, if alacarte were widespread, many if not most channels would start charging more per subscriber, or disappear entirely.

Taken to extremes as an example, there's infrastructure costs to consider on the part of the distributors, like DirecTV, Dish and your cable company. They want a certain profit level per subscriber to recover those costs, and someone opting only for CNN for $0.35/month isn't a subscriber they can profit from, and they don't want to serve that kind of customer. And they feel such a subscriber who wants CNN desperately enough will shell out more for a package of channels before they'd give up CNN entirely, and if they don't they haven't lost anything they considered worthwhile (profitable) anyway.


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## FTA Michael (Jul 21, 2002)

dswallow said:


> If too many people opt out of certain channels, the cost of those channels still has to be paid, which means the per-subscriber rate would have to increase to cover those costs (or other changes would have to get made)


I'm sorry, but it's wrong to suggest that a business has to make $x and changes its rates to meet that figure. Businesses make as much as possible, and set their rates accordingly.

If a business maximizes its revenues (checking its spreadsheet of ads and subscriber fees) at 35c per sub, and if something such as a la carte causes it to lose a bunch of subs, raising the rate might just mean still fewer subs and lower revenues than keeping the same rate or even lowering it. Such an event would reduce overall profits, and it may cause some channels to fold. But saying fewer subs = higher prices per sub is a bit like saying fewer apartment renters = higher rents.

Competition in a free market sets the prices. Competition is good.


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## jrb531 (May 29, 2004)

dswallow said:


> The concept is that getting 30 more channels for $5 more is that you might find a program occasionally among those channels that you have an interest in; and it's just $5 more for the opportunity. And the programmers want viewers, so there's encouragement to provide channels in blocks like this. If you don't get the channel at all, you cannot be a viewer. If you get it, even if you don't really want it, there's always that chance to grab your attention.
> 
> If too many people opt out of certain channels, the cost of those channels still has to be paid, which means the per-subscriber rate would have to increase to cover those costs (or other changes would have to get made), and in the long run, if alacarte were widespread, many if not most channels would start charging more per subscriber, or disappear entirely.
> 
> Taken to extremes as an example, there's infrastructure costs to consider on the part of the distributors, like DirecTV, Dish and your cable company. They want a certain profit level per subscriber to recover those costs, and someone opting only for CNN for $0.35/month isn't a subscriber they can profit from, and they don't want to serve that kind of customer. And they feel such a subscriber who wants CNN desperately enough will shell out more for a package of channels before they'd give up CNN entirely, and if they don't they haven't lost anything they considered worthwhile (profitable) anyway.


Well "I" would like a say in what I pay for. It's all well and good for them to force us to pay for channels "they" think we may like if we are "forced" to pay (and potentially watch) for.

If they think their "deals" are so great then they have nothing to fear in offering ala cart do they? I mean if the deals are so great then we all will take a pass on the ala cart options and opt for the fantastic packages right? 

IMHO they fear what I stated in a prior post.... that this will force two things...

1. We will know what the approximate cost for each channel is.

2. Knowing the cost we can decide to drop channels that we percieve to be too expensive thus adding "real" competition to an industry which has very little.

Cable vs non-cable is not really competition if the big companies that provide the programming do not compete. Sure they compete for ad $$$'s and overall subscribers but not head to head against each other as long as the big companies force a "take all my channels or you get none" decision on us.

As far as channels not being able to compete I can say that Smaller "nitch" channels can survive due to low cost or higher cost spread to those dedicated people who want the channel. Do not make me subsidise the "Watching grass grow" channel just so that the loyal "Grass watchers" can get a better deal. Either the "Grass Channel lowers there price due to the lower viewership, increases their price to the loyal "grass watchers" or they fold saying that maybe this just was not a viable channel to begin with.

As far as companies needing a certain number of subscribers at a certain fee... If I buy my own equipment and install it myself, what are their real costs? As long as they charge me that $5 per box fee and add a small profit for any channel I subscribe to over what they are charged I see no problem. Sure they have have other costs that could be recouped with some "access fees" for those who subscribe to under 10 channels (for example) but the real issue is the "bribes" they give to get new subscribers.

To address this maybe you just give away free stuff to those who will sign a contract to keep a certain teir of service (like cell companies) but for those who buy the equipment outright or have been with the company for years should not have to subsidise the free stuff for new subscribers IMHO.


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## Greg Bimson (May 5, 2003)

carload said:


> I'm sorry, but it's wrong to suggest that a business has to make $x and changes its rates to meet that figure. Businesses make as much as possible, and set their rates accordingly.


However, most of these companies are public, and thus must forecast their revenues accordingly. The availability of a la carte will dampen their advertising rates and their per subscriber monthly revenues. And Wall Street will not take kindly to lowering revenues.

This goes not only for the programmers (the channel owners), but the distributors (cablers and DBSers) as well.


jrb531 said:


> IMHO they fear what I stated in a prior post.... that this will force two things...
> 
> 1. We will know what the approximate cost for each channel is.
> 
> 2. Knowing the cost we can decide to drop channels that we percieve to be too expensive thus adding "real" competition to an industry which has very little.


We already know what a good chunk of the approximate cost of each channel is. The two main offenders are ESPN and the Regional Sports Nets. We know they cost *the distributor* around $5 a month, but we don't know how much *the distributor* marks up the price for their profit.


jrb531 said:


> ...but for those who buy the equipment outright or have been with the company for years should not have to subsidise the free stuff for new subscribers IMHO.


*YOU* aren't subsidizing anything. *The distributors* are subsidizing. *YOU* do not pay new subscribers to join your multichannel distributor; your multichannel distributor sets aside some money to pay. If the distributors stopped "subsidizing" new subscribers, then they will reduce their expenses, not reduce their revenue. That would make the DBS distributors mega-profitable overnight. And it would absolutely destroy their stock price.


carload said:


> Competition in a free market sets the prices. Competition is good.


Yep. And that is why we are where we are today.


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## BabaLouie (Apr 2, 2004)

Greg Bimson said:


> Dish Network spends on average of $550 to lure new subscribers to their platform. That $550 is called SAC, or Subscriber Acquisition Costs. It is one of the yardsticks measuring the health of the DBS industry. DirecTV's SAC is even higher, at $615.


Where does this information come from? An independent source, or the D* and E* propaganda departments?



Greg Bimson said:


> Dish Network and DirecTV are hardly making a profit,


Are you sure about that? It's quite difficult to believe that these two companies have been in business for as many years as they have and are still barely making a profit! What would give their shareholders any cause to
believe that they will ever get a decent return on their investment, if this is indeed true?



Greg Bimson said:


> Both Star Choice and ExpressVu have less that 1.5 million subscribers each. Both companies are part of a much larger conglomerate, and do not break out their divisional numbers to a profit/loss for the unit.


It seems to me that if a company had a satellite tv division that was consistently unprofitable, they would find some way to get rid of that division before long...even in Canada!



Greg Bimson said:


> And I will no longer go searching for information to refute some of these claims. This dissertation took me two hours.


I'm sorry this has taken so much of your time. I do appreciate your articulation and participation in this discussion. Thanks for your effort.


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## dswallow (Mar 31, 2003)

BabaLouie said:


> Where does this information come from? An independent source, or the D* and E* propaganda departments?


It comes from SEC quarterly filings.


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## Fredfa (Mar 27, 2003)

This financial information is easy enough to find in the "investor relations" sections of the EchoStar and DirecTV websites. It is not, perhaps, as easy to understand, however.
The most recent DirecTV and EchoStar financial press releases:

EL SEGUNDO, Calif., Aug 5, 2004 (BUSINESS WIRE) -- The DIRECTV Group, Inc. (NYSETV):
-- DIRECTV U.S. Surpasses 13 Million Subscriber Mark Driven by
Record Second Quarter Net Owned and Operated Subscriber
Additions of 455,000
-- Gross Owned and Operated Subscriber Additions Increase 49% to
an All-Time Record 944,000
-- DIRECTV U.S. Reduces Average Monthly Subscriber Churn to 1.4%
and Increases Average Monthly Revenue per Subscriber 7% to
$65.00
The DIRECTV Group, Inc. (NYSETV) today reported that second quarter revenues increased 21% to $2.64 billion and operating profit before depreciation and amortization was $143 million compared to $251 million in last year's second quarter. In addition, The DIRECTV Group reported a second quarter 2004 operating loss of $28 million and net loss of $13 million compared with operating profit of $66 million and net income of $22 million in the same period last year.

--------------------------------------------------------------------------------------------------------------------------
EchoStar Communications Corp. (ticker: DISH, exchange: NASDAQ) News Release - 8/10/2004 
________________________________________
EchoStar Reports Second Quarter 2004 Financial Results; Company's DISH Network Adds 340,000 Net New Subscribers 
ENGLEWOOD, Colo.--(BUSINESS WIRE)--Aug. 10, 2004--EchoStar Communications Corporation (NasdaqISH) reported that its DISH Network(TM) satellite television service added approximately 340,000 net new subscribers during the second quarter of 2004.
DISH Network had approximately 10.125 million subscribers as of June 30, 2004.
For the quarter ended June 30, 2004, EchoStar reported total revenue of $1.78 billion, a 26 percent increase compared to $1.41 billion for the corresponding period in 2003.
Net income totaled $85 million for the quarter ended June 30, 2004, compared to net income of $129 million during the corresponding period in 2003. Basic earnings per share was $0.18 for the quarter ended June 30, 2004, compared to basic earnings per share of $0.27 during the corresponding period in 2003.


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## Greg Bimson (May 5, 2003)

As an addendum, only because I had to figure this out once before, 2003 was the first year that Echostar turned a profit.

DirecTV is a bit harder to figure out, since the unit was part of Hughes until the very end of 2003. DirecTV was operationally cash flow and EBITDA positive, but it is difficult to separate what DirecTV did outside of Hughes. Hughes, now called The DirecTV Group, has had a few other companies under its umbrella. The former DSL provider Telocity, DirecTV Latin America, DirecTV Brazil, the Hughes set-top box division, all rolled into Hughes earnings.


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## Marvin (Sep 14, 2003)

The only way I would be able to cut the cost of my bill with a la carte would be to drop a lot of channels. I probably watch 25 channels on a regular basis (at least one show or more per week on each channel) and while I could probably give up maybe 5 of them, there are still at least 20 channels that I would want to keep. I can't see how I would be able to do that and spend less than I do now for however many channels TC+ has. I would rather pay the same amount for a greater number of channels then to pay the same or more for fewer channels, even if I don't watch a lot of them. The reciever has a block channel feature which I use to block the shopping/religious/spanish/business channels as it is. I would rather do that then to pay the same amount for D* to allow me to just not let them transmit the channels to me.


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## SimpleSimon (Jan 15, 2004)

jrb531 said:


> ... IMHO they fear what I stated in a prior post.... that this will force two things...
> 
> 1. We will know what the approximate cost for each channel is.
> 
> 2. Knowing the cost we can decide to drop channels that we percieve to be too expensive thus adding "real" competition to an industry which has very little.


We already do know - I posted a link to the MDU rates earlier. They give a real good idea of what's actually going on.



jrb531 said:


> Cable vs non-cable is not really competition if the big companies that provide the programming do not compete. ...


You've hit the nail on the head there!

Finally, someone posted about some individual channel rates would have to go up. Yup - that's right, and the people that want them will pay it. How much does Japan TV cost?


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## Guest (Sep 1, 2004)

I subscribe to Dish Network America's Top 120 w/locals. Other than local channels, here is a list of channels in my favorite list: 

BBC America - Top 120
Bravo - Top 120 
Cartoon Network - Top 60 
Comedy Central - Top 60 
Food Network - Top 60 
IFC - Top 120 
Noggin - Top 120 
Sci-Fi Channel - Top 60 

That's eight channels. Right now four of those channels keeps me on America's Top 120. I don't really even scan through the guide much anymore to watch things. All my regular shows get recorded to my 510 and I watch them there. 

Some people mention the ability to have extra channels to look through "in case something comes on" but I tried that and it didn't work for me. Once a week or so I go through the guide and look for things to record while I'm gone (and to make sure my regular programs don't suffer from a time change), and that's how I discovered a lot of channels I thought I wanted I really didn't. 

I used to have some channels like FX on my list thinking something might come up I'd want to watch, but when I scrolled through the next week or so of listings looking for something to record I never found anything, and eventually they dropped off my favorites list.

So right now AT120 costs me $34.99 a month -- that's about $4.37 per channel.

And really, I could cut this down even more if I wanted to do so. My kids watch Noggin which is why I keep it on my list, but they'll outgrow that channel soon enough and I don't really have to have it. I'm only really watching Stargate: Atlantis on Sci-Fi channel, and for that I could possibly wait for an eventual DVD and get that. Food Network is for Iron Chef which I'm mostly seen by now, and Good Eats which I could also wait for DVDs. Bravo has been for West Wing reruns which I'm about caught up on and Queer Eye shows which I could get eventually get on DVD too I suppose.

The only real channels I really must have are BBC America as some things like My Hero aren't avaliable on DVD in the US and I watch a lot of programming there so getting DVDs of everything else would be a bit much; Cartoon Network I watch all sorts of stuff on; Comedy Central for the Daily Show which is time-dependant and works best if watched when new (and Chapelle's Show, but i could wait for DVDs of that); and finally IFC as I find neat movies there I might not even know existed without having that channel.

So if I really wanted to cut down to essentials I could get by on four channels, but two of those are still AT120.


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## SimpleSimon (Jan 15, 2004)

My favorites list is USA, CMDY, A&E, HIST, SCIFI, DISC, TLC, G4TTV, supers, Showtime package, ALTUD & FOXRM (just added those 2), and the networks.

AT60: USA, CMDY, A&E, HIST, SCIFI, DISC, TLC
AT120: G4TTV

I DO like having FoxNews (AT120) available for when I want it, tho. Sirius, too.

If I need to cut back, I'd drop to AT60 and kill 1-2 of my distant networks.


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## BabaLouie (Apr 2, 2004)

Yep, and I'll bet there is a significant portion of consumers that feels a lot like you do about this. 

Imagine if your movie theater was run this way...you wanted to watch
the latest Travolta action flick, but in order to see it, you also had to purchase tickets to "Nightmare on Elm Street XX", "Pee Wee's Biggest Latest Adventure", Pauly Shore's latest dud, and "Barney's Sing Along Extravaganza". 

Imagine if your grocery store was run this way...you wanted to buy a bag of carrots and a can of green beans, and in order to get them, you had to also buy a pound of caulifower, half-a-dozen brussel sprouts, a turnip, a six-pack of similac, a bottle of mylanta, 6 kinds of breakfast cereal and a jug of cod liver oil.

Imagine if your auto service center was run this way...you wanted to get a lube and oil-change, but you could only do it if you also purchased a set of tires, got all the belts replaced, put in a new windshield, had your front-end aligned, replaced your muffler and got a valve job.

Imagine if your hospital was run this way...you needed to get a gall-bladder removed, but in order to do that, you had to also get a colonopscopy, a hysterectomy, a knee replacement, a jaw alignment, a thyroid removal, and a nose job.

The American consumer is used to CHOICE, and it grates on me (and I'm not the only one) when there's so little of it when it comes to my satellite programming options. I know that there have been many good points made
by those who are opposed to greater selection, but still, when it comes right down to it, I want more choice. 

I do believe that choice might one day be available over the Internet or a phone line. If that day arrives and E* and D* are crying about losing subscribers, I for one will not feel a twinge of sympathy for them.


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## Greg Bimson (May 5, 2003)

BabaLouie said:


> The American consumer is used to CHOICE, and it grates on me (and I'm not the only one) when there's so little of it when it comes to my satellite programming options. I know that there have been many good points made
> by those who are opposed to greater selection, but still, when it comes right down to it, I want more choice.


You've made a couple of mis-statements right here.

Most of us are not "opposed" to a la carte. I, for one, am not opposed. But make it true a la carte. You buy your programming with no package. You buy your programming however your distriubtor sets the rates. It could be along the lines of Echostar's $5 access fee with no subscription to an "America's Top XX" package, and ESPN and Disney channel cost $10 each.

But, along your lines of choice, there are choices you do not get to make. I want the choice of buying a Cube that contains 8 Mountain Dew, 8 Pepsi, and 8 Sierra Mist. I want the choice of buying a five-pack of beer, or a carton of seven packs of cigarettes.

The distributors have the choice to package how they want. The programmers have the choice to get their channels into specific tiers. Consumers, well, consume. And nearly 85 percent of Americans get their programming the way the distributors have bundled the programming products.

We aren't saying you are wrong, we are simply saying what you wish for may just cause everyone's rates to skyrocket.


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## Guest (Sep 1, 2004)

Greg Bimson said:


> But, along your lines of choice, there are choices you do not get to make. I want the choice of buying a Cube that contains 8 Mountain Dew, 8 Pepsi, and 8 Sierra Mist. I want the choice of buying a five-pack of beer, or a carton of seven packs of cigarettes.


I can go to a soda machine and buy cokes, mountain dews individually, so getting 8 of one and 8 of another is not a problem. I don't drink or smoke, but I imagine there are similar options there as well.

The analogy is more like this -- one can go to a fast food place and buy their sandwich by itself, or get a happy meal or something for a combo deal. With things like America's Top Whatever and Total Choice you already have happy meals. All people like me want is the ability to buy a sandwich by itself.

Costs will not skyrocket. The simple reason why is that at some point, people will not stand for it. This is what the market is for. The so called "Invisible Hand". This is why many people switched from cable to satellite, due to outrageous cable costs.


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## Greg Bimson (May 5, 2003)

No, Visitor, wrong analogy. Products are packaged all the time. Some products aren't.

Sure, I can get 8 Pepsi's individually, but why can't I get 8 cans in a package? Because it isn't _my choice_. Just because someone believes ESPN is a programming service doesn't make it valid that it must be sold alone. It can, and is, packaged, and it does not have to be sold a la carte.

Just as a reminder, ESPN, by itself, costs more to the cablers and the DBS providers, than buying ESPN, ESPN News, ESPN Classic, and ESPN2 as a package.


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## SimpleSimon (Jan 15, 2004)

Yeah - ESPN is totally frelled. According to the MDU card, it's the ONLY channel set that works that way.

Link repost for convienence: https://rweb.echostar.com/commercial/forms/MDUBulkRateCard.pdf


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## jrb531 (May 29, 2004)

The soda anology is correct.

Say I want 6 cans of soda but I want 6 different flavors. I can pay "more" per can and go to the vending machine...

or

I can buy a 6-pack and save a ton of $$$ "but" I am forced to take what they pre-package into that six-pack (usually 6 of the same flavor but the anology is the same)

So go ahead and pre-package "channel packs" that will save me $$$ if "I" want to take advantage of that...

but

Allow me to pay more if I want to pick and choose.

This way I can subscribe to TC60 and then pick the two channels in TC120 that I want instead of having to take them all.

If I want more than a couple from TC120 then I might as well take the entire package but give "me" the option.

You cannot say that things are packaged for us and this means they can tell us what channels we have to take as a package because the items you refer to are duplicate with a "bulk" savings for buying multiple items of the "same" type.

Channel packages are different. There is no linkage at all between them (aside from the HBO type packages that are really just one channel timeshifted) aside from some third party deciding what to link together for us. Nothing about TC60 is linked in any logical way aside from the bean counters trying to separate channels into packages to "make" us want to subscribe to multiple packages....

And BTW why are the packages in tiers and not just separated? In other words why is TC60, TC120 and TC180 inclusive of the prior tier? Why not have...

TC1, TC2, TC3 with each having about 60 channels so I could pick "just" one or two of them. Say I want TC3 but not 1 or 2?

Come on everyone! We know why this is being done. We're not stupid. Everything is designed to get us to subscribe to the maximum amount of channels. This is nothing more than them against us. If we win and get to pick they lose $$$, if we lose then they continue with their free hand to keep this crap up and continue to add to our monthly bills.

Has anyone ever wondered why as the companies added more and more channels they did not increase the number of packages for us? It's always three packages and as they add more channels the costs go up.

Why not make 4 tiers or 5 tiers and keep the price down? Why... because they do not want the price to stay lower. Some of this is the fault of the Dish/Cable companies but I suspect more is the fault of the programming providers who keep "inventing" new channels and adding them to their "family" of channels.

How do they "force" Dish/Cable companies to take the new stuff? Why they tell them they have to take all the channels or they get none. You want the popular QWERT channen then you have to take this crapola ASDFG channel.

Well that's BS and trying to say it's ok because companies package coffin nails in multiple packs (they still sell single packs of coffin nails thou!) is not the same as taking 20 totally different channels and saying "take them all or you get nothing"


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## Nick (Apr 23, 2002)

Visitor said:


> I can go to a soda machine and buy cokes, mountain dews individually, so getting 8 of one and 8 of another is not a problem...


Apples & Oranges

You can get your sodas out of a machine one at a time for $1.00-$1.50 each, or you can buy them in a 6-pack, 12-pack or case where the unit cost would go as low as 20-25¢ each. If you want a six-pack of different flavors, you have to pay the single unit price, which would cost you $6-$9 for your "ala cart" soda selection.

If you don't like the way cable, Dish or Direct package their programming, you don't have to buy it. Turn off the TV and go do something worthwhile. Having subscribed to a given cable or DBS package, you essentially have told your provider that you "like" that tier of programming.

~~~~~~~~~~

The one thing you DO NOT want is the government _mandating_ ala cart, or any other programming options.

It's time some of you people realized that "THE GOVERNMENT" is not the solution to our problems. 
It often IS the problem.

~~~~~~~~~~

_"Be careful what you wish for -- you just might get it."_


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## jpurkey (May 15, 2003)

SimpleSimon said:


> Yeah - ESPN is totally frelled. According to the MDU card, it's the ONLY channel set that works that way.


It's the same pricing with DirecTV: http://www.directv.com/DTVAPP/buy/Business_Lodging.dsp (look at the Change Request Kit for channel pricing)

However, ESPN is only priced that way since the business or hotel has to show all four channels if they take all four. For consumers, I'm sure the pricing would be different with one channel costing less than all four.


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## BabaLouie (Apr 2, 2004)

Nick said:


> If you don't like the way cable, Dish or Direct package their programming, you don't have to buy it. Turn off the TV and go do something worthwhile.


And that just reinforces my opinion that if D* and E* would offer a-la-carte, it would INCREASE, rather than decrease, their customer base...It would result im MORE business for them, and more people using their services.

D* and E* hold out the threat that a-la-carte will result in skyrocketing prices for the consumer...Excuse me, but I've heard that threat before. "If we have to carry all the locals, it will result in skyrocketing prices for the consumer"..."If we aren't allowed to merge, it will result in skyrocketing prices for the consumer"...Sounds like the same song, different verse.


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## Selenna (Jun 18, 2004)

Nick said:


> ~~~~~~~~~~
> 
> The one thing you DO NOT want is the government _mandating_ ala cart, or any other programming options.
> 
> ...


Thank you Nick! That's what I keep thinking each time I see a post of "let's pass a law making them do it and then the free market will sort it out". How the hell is it a free market when what they're allowed to do is mandated?


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## Greg Bimson (May 5, 2003)

BabaLouie said:


> And that just reinforces my opinion that if D* and E* would offer a-la-carte, it would INCREASE, rather than decrease, their customer base...It would result im MORE business for them, and more people using their services.


Ahem...

DirecTV _had_ a package called Select Choice. DirecTV removed the package because they didn't want any "bargain" shoppers.

Dish Network _had_ a package called Dish Pix. Dish Network removed the package, most likely because they couldn't make a profit on it.

More business doesn't necessarily mean more profitable business.


> D* and E* hold out the threat that a-la-carte will result in skyrocketing prices for the consumer...Excuse me, but I've heard that threat before. "If we have to carry all the locals, it will result in skyrocketing prices for the consumer"..."If we aren't allowed to merge, it will result in skyrocketing prices for the consumer"...Sounds like the same song, different verse.


The local channel argument was not about skyrocketing costs; the local channel argument was that serving all local channels within a market would starve bandwidth.

The merger argument is also incorrect. One reasoning for attempting the Echostar/DirecTV merger was that a consolidated DBS company could more effectively compete with the cable "monopoly". Unfortunately, that would have also left Echostar as the DBS "monopoly". The proposed merger would have also kept pricing down from the programmers, since the merged DBS company would now be at around 25 million subscribers. That would have made Echostar larger than Comcast.

Let's not forget that many of the larger cabler and the DBS companies are pretty happy with the current arrangement. The programmers (channel providers) are also fairly happy. The free market has evolved over the past thirty years to get to this point.

Some of the smaller cablers and smaller programmers are not happy. The small cablers are having a harder time competing because they get less revenues because they don't have many subscribers. These small cable companies then have to deal with much better competition and pricing from DBS companies, which in turn is causing erosion to their revenues.

The small programmers have no leverage to get on a cable/DBS system. Of course, there aren't going to be many new, or exciting channels added to a system, when there is almost a channel for everything these days.

These small cable companies blame high-priced programmers like ESPN and the regional sports networks as the cause of their problems. However, ESPN and the rest were not the cause of their problems when the cablers were building their business.

Show me the first cable company to drop ESPN from their lineup, and I'll show you a cable company that goes out of business.


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## FTA Michael (Jul 21, 2002)

"Without the proper rules, healthy capitalist markets turn into sluggish oligopolies, and that is what's happening in media today." -- Ted Turner.

Full story here: http://www.backchannelmedia.com/newsletter/20040817/05-print.html

The government is already deeply involved in setting rules (station ownership, must-carry, satellite sports nets, etc.) for what we watch. The question is not whether there should be any government involvement, but what are the best rules to continue or create.


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## Greg Bimson (May 5, 2003)

I take any quote regarding media consolidation by Ted Turner with a grain of salt. After all, he added to the "oligopoly" when he merged his Turner Broadcasting with Time-Warner, to create the largest media conglomerate at the time.


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## jrb531 (May 29, 2004)

Yeah... let's remove all government controls for monopolies. I'm sure one huge company would be very fair for pricing.

The US has always stepping in when anti-compentative forces started to take over a market segment. If they have to they break up the companies. Right now a few select channels are producing most all of the programming.

"This" is the problem. If we have 50 companies producing 50 channels we would not have an issue with these packages. The issue is that we have a half dozen companies producing those same 50 channels and they want "all" their channels included.

This is why the government stops the large companies from buying up all the TV or radio stations. Sure they are allowed one in each market but without these rules some companies would buy up all the TV/Radio stations in a market and raise prices for everything.

Some rules/laws are a necessary evil.

When the large companies get together to raise prices and remove competition the government has to step in and this is what has happened now.

I ask this question again... Why do people seem to fear ala-cart? If the prices of ala-cart channels are too high people will just choose the packages but how does it hurt you?

I'm sorry but if "Big Business" does not want ala-cart there is a reason and this reason is "not" to protect us!

What I think "some" people fear is that ala-cart will force those who want packages to pay the "real" cost of those channels and not have the rest of us subsidize them. You get all those channels cheaper because more people are subscribing to them so even if 95% of the people do not watch the "Grass Growing Channel" since we are all force to pay for it it amounts to 50 cents per person and the "Grass Growers" love that price. If we get the chance to remove that channel then the "Grass Growers" might have to pay $10 a month for it.

Sucks if you like those fringe channels but how fair is it to make 95% of the people pay for what 5% of the people watch?

Maybe the "Grass Channel" cannot survive without "forced" subsidies and I say good... more bandwitch avail for channels that most people watch.

As I said before... this "only" happens because we lack competition and we lack competiton because it is the best interest of the big companies to "not" compete.


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## Greg Bimson (May 5, 2003)

jrb531 said:


> Yeah... let's remove all government controls for monopolies. I'm sure one huge company would be very fair for pricing.


No one ever said to remove government oversight on monopolistic practices.


jrb531 said:


> When the large companies get together to raise prices and remove competition the government has to step in and this is what has happened now.


If "companies get together to raise prices and remove competition", you'd better report them to the Federal Trade Commission. That is called collusion, and is quite illegal.

I am still trying to figure out this "remove competition", but I believe I have found it right here:


> As I said before... this "only" happens because we lack competition and we lack competiton because it is the best interest of the big companies to "not" compete.


Compete how?

They compete for your eyeballs. They compete for money they charge distributors. They compete for advertisers. Just because the distributors cannot unbundle pricing to their subscribers doesn't mean there isn't any competition.


jrb531 said:


> I ask this question again... Why do people seem to fear ala-cart? If the prices of ala-cart channels are too high people will just choose the packages but how does it hurt you?


And once again, I state that I am not against a la carte. I am against unbundling packages.

Go back and look at the first post in this thread. It is assumed that most people would like a la carte if the pricing were reasonable. I just don't think too many people have figured out what reasonable is.


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## jrb531 (May 29, 2004)

They do not compete as you have no choice to cancel channels you do not want. As long as you "have" to subscribe to large groups of channels (All or nothing) you have no choice.

No choice = no competition.

Being forced to offer ala-cart does not mean that packages will go away.

You can offer both but I admit that if more people select ala-cart instead of packages then the packages will go up in price.... I just happen to think that this is not a bad think as it will more fairly reflect people paying for what they watch and not forcing people to subsidize channels to keep their price low for others.


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## Guest (Sep 8, 2004)

You know, a while back the cell phone companies were saying "You can't keep your phone number and change providers. If we have to do this then rates will go up horribly and everyone will suffer."

Now, of course, cell phone number portability is available, by government mandate no less, and curiously things seem to be working out.


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## SimpleSimon (Jan 15, 2004)

Yeah right said:


> You know, a while back the cell phone companies were saying "You can't keep your phone number and change providers. If we have to do this then rates will go up horribly and everyone will suffer."
> 
> Now, of course, cell phone number portability is available, by government mandate no less, and curiously things seem to be working out.


Good post - You should join us and register.


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## Greg Bimson (May 5, 2003)

However, phone number portability does nothing to change the grand scheme of things. The infrastructure of the phone companies were upgraded, which is a charge on expenses, not revenues. The mandate also does not affect a business relationship between two companies, such as a program provider (a channel) and a multichannel distributor (DBS and cablers).


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## jrb531 (May 29, 2004)

But it does provide a good example on how the large companies will say and do almost anything to avoid change and "business as usual" even pulling out the old "rates will rise" boogie man approach that we keep falling for time and again.

What's good for big business = bad for consumer and if they don't like it.... I want it


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## Greg Bimson (May 5, 2003)

I am reminded of a county in California that passed a law requiring banks to drop ATM fees. The affected banks simply stopped accepting competing banks ATM cards.

Needless to say, the law was repealed the next day.

Most regulations are internal, and affect expenses. Any a la carte implementation will affect revenues, to both the distributors and the programming providers. That is why I am constantly pointing this out. If their revenues are affected, then be prepared for some nastiness.

I myself wouldn't mind adding Fox Sports World to my Total Choice Plus subscription. I don't want to add an $11 pack just to get this one channel. However, the packaging takes place between a program provider and a distributor, and I am fine with it. I've lived without the channel for this long.

I simply keep going back to the original post. Everyone is for a la carte *if the channels aren't cost prohibitive or outrageously priced.* And I simply tend to agree that if a la carte is implemented, the pricing may be much higher. I would hope that the subscribers that take a package aren't going to subsidize those people that pick their channels.

Every single example I've given clearly shows that a package cost less than individual channels. So the question remains whether or not any implementaion of a la carte will be beneficial to *all parties*, consumers included.


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## jrb531 (May 29, 2004)

Greg Bimson said:


> I would hope that the subscribers that take a package aren't going to subsidize those people that pick their channels.
> 
> Every single example I've given clearly shows that a package cost less than individual channels. So the question remains whether or not any implementaion of a la carte will be beneficial to *all parties*, consumers included.


But it's ok under the current setup for subscribers who do "not" want certain channels to subsidize those that do. This is my main point. The "only" reason some of these less watched channels can survive is because they force "everyone" to pay for them when only a small percentage watch them.

1 million people paying 10 cents a month ($100,000 a month revenue) for some Grass Growing channel seems cheap until those 50,000 people who really want the channel are forced to pay the full cost of the channel they want which then makes it $2 each.

If take this to the logical conclusion then everyone will only pay for the channels they want but will pay a higher cost "if" the channel is not a popular one and few subscribe to it. All this will do is to eventually force those unpopular channels off the air and free up space for channels that most people want.

I don't care (aside from taking bandwidth) how many silly channels they want to add to the lineup as long as I am not "forced" to pay for them like the current setup does.

What makes you think that ala-cart will force those taking packages to "subsidize" the ala-cart people? IMHO most people will still take packages but add an ala-cart or two to a package.

I would rather pay $5 for the one channel I would like to add rather than $10 to get that same channel as part of a 20 channel upgrade package. Who cares that the package would be a better "deal" if I will not watch those other 19 channels?

The logic in offering ala-cart is iron clad from the "consumer" standpoint. The programers hate this as it will lower revenue, the providers hate this as this will lower revenue, the goverment prob does not want this as it lowers taxes (lower bills = less taxes) and the advertisers do not like this.

Everyone is against this but the consumer (and those consumers who fall for big business's line of BS) as it will mean lower monthly bills.


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## FTA Michael (Jul 21, 2002)

jrb531 said:


> 1 million people paying 10 cents a month ($100,000 a month revenue) for some Grass Growing channel seems cheap until those 50,000 people who really want the channel are forced to pay the full cost of the channel they want which then makes it $2 each.
> 
> If take this to the logical conclusion then everyone will only pay for the channels they want but will pay a higher cost "if" the channel is not a popular one and few subscribe to it. All this will do is to eventually force those unpopular channels off the air and free up space for channels that most people want.


Your conclusion is logical, but your premise is faulty. If the Grass Growing Network (GGN) is making $100k/month under the old system, but the new system lets consumers decide whether they want to pay for it, then it really doesn't matter how much GGN was making under the old system. GGN execs will estimate how many people would buy at every price point, factor in advertising sales, then come up with a price to maximize revenue.

In this case, it's likely that GGN's monthly revenue will fall below $100k. Will it make enough to survive? Well, if it's a GloboCorp network, and most of its programming consists of GloboCorp reruns, leftovers, and really cheap backyard shows, it'll probably make money (albeit less money) even with less revenue. And GloboCorp will usually lean toward keeping it on the air because one day it might decide to makeover/relaunch the network as Gaming on Grass, appealing to a new audience but with a built-in subscriber base.


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## Greg Bimson (May 5, 2003)

And once again, I still go back to how far will this go? Most of the people complaining seem to want to shove ESPN and their RSN out of their base package.

It completely depends on how a la carte is implemented.


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## jpurkey (May 15, 2003)

Greg Bimson said:


> And once again, I still go back to how far will this go? Most of the people complaining seem to want to shove ESPN and their RSN out of their base package.
> 
> It completely depends on how a la carte is implemented.


Cheap channels (those that cost N cents or less per month) could and probably should still be bundled. And those channels could still negotiate pricing with the cable and dish companies as they do now.

However, channels costing more than N cents should be offered a la carte and/or be put in optional add-on packages.

As I've said before, I don't mind paying 5 or 10 cents a month for a channel I never watch, knowing that other subscribers are paying the same for the channels I do watch. I do not however like paying $1+ for every channel I never watch. If someone wants to watch ESPN or Disney so badly then they should be willing to pay for them.


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## jrb531 (May 29, 2004)

jpurkey said:


> Cheap channels (those that cost N cents or less per month) could and probably should still be bundled. And those channels could still negotiate pricing with the cable and dish companies as they do now.
> 
> However, channels costing more than N cents should be offered a la carte and/or be put in optional add-on packages.
> 
> As I've said before, I don't mind paying 5 or 10 cents a month for a channel I never watch, knowing that other subscribers are paying the same for the channels I do watch. I do not however like paying $1+ for every channel I never watch. If someone wants to watch ESPN or Disney so badly then they should be willing to pay for them.


I feel the same! Maybe all they have to do is pass a law saying that any channel that costs so much must be offered as an ala-cart option. Only problem would be them trying to lower the cost of an "ESPN" and raising the price of others to compensate to get around the law but I bet they could figure a way to monitor this.

They already do offer the expensive channels as ala-cart (HBO, Showtime etc...)

I would suggest an easy way to do this would be to average the cost of all non-premium channels and any channel that costs more than 25 percent above the average would have to be offered ala-cart.

If the average channel costs 50 cents then any channel that costs more than 75 cents would have to be offered ala-cart. This way the ESPN type packages would have to be offered ala-cart or they would have to lower the price of each channel to 75 cents or less.

Example: ESPN can either offer their 5 channel's as a package for $5 or they would have to lower the price of each of those 5 channels to 75 cents each or $3.75 to be included in a package. Not much of a savings but it would lock down the ever increasing costs for these channels as the companies would not want to price themselves out of the "packages" and into ala-cart....

Or they would jump to ala-cart and become a "premium light" package.

Either way we win as they would either have to cost costs or deliver great content to justify people paying extra for them.


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## FTA Michael (Jul 21, 2002)

My guesses:

1) If Congress or the FCC ever said that only channels that cost X cents or less may be bundled, you'd see a mad rush to drop a whole lot of channels from their current costs to X, while simultaneously raising any lower-priced "corporate sister" channels *up* to X. Is that really what you want?

2) If (1), then in future years, the programming providers would pressure Congress to raise the X number to reflect higher yach^H^H production costs. Eventually, only true premium channels (which might include ESPN) would still be forced to unbundle.

3) Remember that part of the push for a la carte comes from fana^H^H concerned citizens who don't want to "subsidize" channels they hate. Knowing that the heathen MTV only gets $2.40/yr from me rather than $6/yr is small consolation if I think it's the evil force that's making our young people act so crazy! 

In sum, I don't agree that it would be wise to set some lower price limit on bundling. Me, I'd like a deal like E*'s Superstations - pay for one or two individually, or get the whole set at a slightly reduced price.


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## jrb531 (May 29, 2004)

Did not think of it from that point of view Car. If you object to the channel then 1 cent is the same as $5.

I would rather have "true" ala-cart but I would rather have some rather than none.


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## jpurkey (May 15, 2003)

carload said:


> My guesses:
> 
> 1) If Congress or the FCC ever said that only channels that cost X cents or less may be bundled, you'd see a mad rush to drop a whole lot of channels from their current costs to X, while simultaneously raising any lower-priced "corporate sister" channels *up* to X. Is that really what you want?


For it to work, channels costing less than X cents would still need to negotiate a price with the cable and dbs providers.

Now, if channels want to LOWER their cost to be included in the base package, then so much the better for the customer.


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## Greg Bimson (May 5, 2003)

jpurkey said:


> Cheap channels (those that cost N cents or less per month) could and probably should still be bundled. And those channels could still negotiate pricing with the cable and dish companies as they do now.
> 
> However, channels costing more than N cents should be offered a la carte and/or be put in optional add-on packages.





jrb531 said:


> I feel the same! Maybe all they have to do is pass a law saying that any channel that costs so much must be offered as an ala-cart option. Only problem would be them trying to lower the cost of an "ESPN" and raising the price of others to compensate to get around the law but I bet they could figure a way to monitor this.


But you cannot ask Congress to pass a law to simply change the pricing structure of everything, and then say "let the free market decide". The free market has already decided that an extremely large chunk of the public would rather buy a package than to buy specific channels.

Besides, any law that mentions price would be considered discriminatory. It discriminates against a channel where the free market has already decided upon the value of the carriage for a specific station within a specific tier.


> Example: ESPN can either offer their 5 channel's as a package for $5 or they would have to lower the price of each of those 5 channels to 75 cents each or $3.75 to be included in a package. Not much of a savings but it would lock down the ever increasing costs for these channels as the companies would not want to price themselves out of the "packages" and into ala-cart....


Well, you probably need to read this:

Let's say that Dish Network only wants to carry ESPN, and not the Deuce, Classic, or ESPNNews. Did you know it would cost Dish Network more money to carry only ESPN, as opposed to the entire suite of four channels?


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## jrb531 (May 29, 2004)

Why do you keep insisting that the free market has already decided that we prefer packages? When were we allowed to choose between both and picked one over the other?

The "technical" aspect of analog cable decided that they needed packages due to technical limitations. It's only been fairly recent that Cable and of course Dish has gone digital and allowed us, from a technical standpoint, to turn on and off individual channels. Sure Dish could always do it but until fairly recently the majority of the country was on analog cable and could not.

So the free market had nothing to do with the current setup and the cry for forcing them to allow "us" to choose is what we are talking about.

Now if we eventually get to choose we can come back here in a few years and see what the free market ended up picking but until then I still rally around giving us a right we "never" had!


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## Greg Bimson (May 5, 2003)

> The "technical" aspect of analog cable decided that they needed packages due to technical limitations. It's only been fairly recent that Cable and of course Dish has gone digital and allowed us, from a technical standpoint, to turn on and off individual channels.


There is no "technical aspect of analog cable". There have been other premium channels that have moved to packages. I keep giving examples, and you keep throwing them away...

Take my area, about 12 years ago. In Montgomery County, Maryland, Disney Channel and Home Team Sports were both *premium channels*, each costing at least $8.95 per month.

The public was given the choice, but didn't want it due to the high-cost of a la carte. Both of these channels were rolled into basic cable quite some time ago.

Once again, the only people complaining about a la carte have been looking at the costs to the distributors, and now believe they can get a better deal.

A la carte legislation will not remove channels from packages due to high cost. If a la carte ever is implemented, it will not destroy the current business models. It may be a secondary option; however, I keep pointing out that many programming options, when unbundled, are much higher priced.

I keep giving examples, and all I see is rhetoric.


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## Greg Bimson (May 5, 2003)

> Why do you keep insisting that the free market has already decided that we prefer packages?


Before I forget...

You've forgotten basic economics.

Supplier -> Demander.

Provider -> Consumer.

An individual is not necessarily at the end of the equation. So look at this:

ESPN -> DirecTV.

DirecTV -> consumer.

ESPN only deals with the multichannel distributors. They do not have a direct relationship with individuals.


> When were we allowed to choose between both and picked one over the other?


Analog systems aren't necessarily technically infeasable. In the early '90s, many had addressable boxes for analog.

Don't you remember NBC's failed attempt at the Red, White, and Blue channels during the 1992 Olympics? All addressable pay-per-view? No different than having premium channels. No different than requiring an analog converter box for a la carte.


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## SimpleSimon (Jan 15, 2004)

Greg: Just because the cable pig is piggish, doesn't mean ala carte will be out of line. Refer back to C-Band programming, about 12 years ago. 

I didn't take Disney not because it was $4-5/month, but because it was pretty much kids only, so I didn't need it.


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## Greg Bimson (May 5, 2003)

> Greg: Just because the cable pig is piggish, doesn't mean ala carte will be out of line. Refer back to C-Band programming, about 12 years ago.


Let's say you're right, Simon.

So we'll make a few assumptions:

Cablers are all greedy pigs. That is a given, and I am sure with these digital, addressable cable boxes, they'd figure out a way to allow more a la carte, if it is also beneficial to them.

DirecTV doesn't want to worry about smaller base packages. After all, DirecTV, during many conference calls with analysts, have stated that they want their average revenue per unit (ARPU) to increase, along with their net new subscriber increases. DirecTV even did away with their smallest base package, Select Choice. So, don't count on DirecTV to help with a la carte.

Dish Network, on the other hand, is the low-cost provider for satellite TV. You'd think they might try to get in on the a la carte action, until:

You realize they got rid of their Dish Pix package. The international channels, which are technically a la carte, are priced pretty high.

That is why I continually mention that it is hypocritical to state "let the free market decide", and it is used in conjunction with "a law needs to be passed." That isn't the free market. The free market is how two parties can come to an agreement *without the need for government intervention*. And that is what these program providers and distributors are doing.


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## BabaLouie (Apr 2, 2004)

Greg Bimson said:


> DirecTV doesn't want to worry about smaller base packages. After all, DirecTV, during many conference calls with analysts, have stated that they want their average revenue per unit (ARPU) to increase, along with their net new subscriber increases.


Both Dish and Directv are on this track, and that's why they don't want to offer ala-carte. If they can get $29.95 or $39.95 minimum out of each customer, then why offer services so they might only get $15.95 or $19.95 or $25.95 per customer? This is exactly the point I tried to make earlier, Greg...These providers have determined that they want to get a certain MINIMUM amount of money out of each customer, they can do that by bundling their programming in a certain way, and there is NO competitive incentive right now to cause them to change that. They definitely come out ahead with this arrangement. As you stated in an earlier post, they are quite happy with the current arrangement. No doubt! They will be able to rake in massive profits for years! It would be the same as if all my local grocery stores forced me to buy a whole cartload of groceries, including items I didn't want, everytime I went through the line, rather than allowing me to select just a few items to purchase.

I appreciate your pro-Dish and pro-Directv position, but the losers in all of this are those of us consumers who desire greater choice and flexibility in their purchases. Again, I suspect that when and if ala-carte options are provided via cable and/or internet, then Dish and Directv will be forced to change their ways. They may not be able to catch-up then.


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## Link (Feb 2, 2004)

Besides, the local networks ABC, CBS, NBC, Fox, and WB, I only watch about 6 of the other channels on a regular basis-- and of course some of those channels happen to be in the Top 180 package so you end up having to pay $20 extra from the Top 60 just for maybe a couple stations. That is why the a la carte would be a better option.

I'd pay up to $2 a channel which still would be cheaper than $50 a month for me.


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## SimpleSimon (Jan 15, 2004)

I think what BabaLouie just said is where it's at, and the minimum $ per month thing is an important part of the business model - and needs to be. My electrical co-op has a minimum per month to stay connected, some water companies also do - a company has to cover it's overhead, and there's nothing wrong with that.

So, charging a minimum per month is acceptable. Now, allow the customer to pick what they want to get to that minimum - or if all they want is channel "X" and they're willing to pay the baseline price - fine!

Now, on that concept, add mini-packages - like locals, sports, movies, just like we have now, but more of them. I'd like to see a HIST, DISC, TLC based package. Call it "science" or something. I want to watch DWNGS, but am NOT going to go to AT180 to get it. I'd toss another $1 out for it though - or buy it along with the other Discovery channels as part of the "science" package - even though I likely wouldn't watch the other DISC channels - at least they're 'close' to my viewing habits.

Now, we'll see competition in how the mini-packages are built and priced.

Finally, allow receivers to work with any of the programming disributors - just like the old C-Band days. With the right STB, you could have multiple providers, allowing things like NFL-ST from D*, "science" from E*, and HD from V*. Yes, there's some technological issues - like having enough dish/LNB access, but it can be done.


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## FTA Michael (Jul 21, 2002)

It wouldn't be that difficult for a provider to set a minimum. There are certain channels that currently _must_ be made available (locals and PI channels). Package those mandatory channels plus the viewer's choice of X additional channels from Column A for the minimum $29.95/month. That's pretty close to what the Canadian DBS providers do right now.

Or the US DBS folks could provide a "lifeline" mandatory-only set for *un*-subsidized equipment for $19.95 or so. (You want a free receiver? That requires a 1- or 2-year commitment to AT29.95 or higher.)


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## Guest (Sep 21, 2004)

This sound like the radio content debate. The real simple answer for the real simple folk who find everything offensive because some book told them it is offensive is to lock out the channels they don't want. Very simple solution to their moral delema.



durl said:


> Just making sure I'm up on my definitions here: "far right wing" = anti-communist. i.e. Anyone who disagrees with the far LEFT wing (socialists/communists)
> 
> So...which other groups do you wish would keep their mouths shut and let the other people run things?  Sorry...not trying to stir controversy here. Just trying to stress the point that ALL Americans have a say in what happens in government...regardless of whether you agree with them or not. Ain't a republic grand?
> 
> I wish ala carte would work as well, but I have my doubts that we'll see it any time soon. There's a LOT of channels out there that I've never watched and probably never will and I don't like the idea of paying for them.


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## FTA Michael (Jul 21, 2002)

No, my dear unregistered guest, what galls some folks is that they are effectively forced to pay for channels they actively oppose in order to get the channels they really want. These people aren't suggesting (for example) that MTV should be forced off the air so much as they're saying they don't want to support MTV with their TV dollars.

Me, I just want the FCC to step in and force MTV to show nothing but music videos. Preferably with that moon launch clip and Martha Quinn giving us the latest scoop on Duran Duran's tour dates.


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## jrb531 (May 29, 2004)

A few things...


1. Analog Cable was forced to use packages as there were not enough scrambling (sp?) methods available on the old boxes to allow each channel it's own method.... IE They could not independantly shut on and off "all" channels. Sure they could put a few premium channels on their own but not all so packages were required way way back.

2. I don't care how you put it... the "consumer" never decided that we prefer packages over ala-cart or even a modified package + ala-cart as we never got that option. It does not matter who decided for me be it the providers or the distributors "I" did not get that choice and I care not for others to tell me what I want to pay for.

3. The fact that big business is manipulating what is in each pachage for no other reason than to try and force people to pay for more than one package is proof enough that the current system does not work without some form of intervention.

4. The reason we need government intervention is that we do not have "real" compertion as long as the content providers are forcing that same "take all my channels or none" approach on both dish and cable distributors. I'm not a big fan of regulation but sometimes when the system is broke and has no way of fixing itself due to monopolistic forces the government has to step in.

Let me end it with this question:

If I pay 100% for all the equipment and 100% for the instalation and I want to subscribe to a single channel (providing I pay the "real" costs of maintaining my account) then why can't I?

Why?

Why will they not take my $$$ even if they make a profit off that one channel?

Think real hard about this. There is no technical reason for them not to take my $$$.

In the end the real answer is twofold...

1. They can make more $$$ by not allowing this.
2. They don't have to.

IMHO neither reason is valid.


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## Greg Bimson (May 5, 2003)

I was going to reply, point-by-point, to each issue in jrb531's post. Instead, I'll take simply the bottom part:


> Let me end it with this question:
> 
> If I pay 100% for all the equipment and 100% for the instalation and I want to subscribe to a single channel (providing I pay the "real" costs of maintaining my account) then why can't I?


You can. Go C-band. Except that you still have bundling of some channels. There is your option. If you don't like that option, no one must give you another option.


> Why will they not take my $$$ even if they make a profit off that one channel?


They are businesses. Why should they have to? I don't go into 7-11, grab a small cup for soda, and fill it one-third of the way, and expect the price of the soda to be one-third of a full cup of soda.


> Think real hard about this. There is no technical reason for them not to take my $$$.


But there are business reasons.

You can get steak. You can get it at the grocery store, and cook it yourself. You can get it at Ruth's Chris. People walk into Ruth's Chris because of the level of expectation in service. Those people don't expect to walk into Ruth's Chris expecting to get a steak served as if the restaurant was a Sizzler.

Besides, if you really want to pay a la carte, why not sign yourself up as if you were an MDU? You have to pay commerical prices for the receiver, and you have to pay somewhat higher a la carte programming fees. The ability is there; you can use it. The issue is that you'll pay twice as much in total ownership costs than if you used the regular, residential pricing. Because no matter how many times I post this, you overlook it: everything costs more unbundled.


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## SimpleSimon (Jan 15, 2004)

Greg Bimson said:


> ... I don't go into 7-11, grab a small cup for soda, and fill it one-third of the way, and expect the price of the soda to be one-third of a full cup of soda.But there are business reasons. ...


I see your point, but just because it's a fun deconstruction  ...

But 7-11 doesn't make me buy coffee (sports) when I buy the soda (HIST, TLC, DISC).


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## BabaLouie (Apr 2, 2004)

Greg Bimson said:


> I don't go into 7-11, grab a small cup for soda, and fill it one-third of the way, and expect the price of the soda to be one-third of a full cup of soda.


This is not even close to being an apt comparison to the satellite a-la-carte question...Greg, your example might well serve to illustrate why I can't order History Channel to be received in my home for only 8 hours each day, and then expect to pay only one-third of the regular monthly price for that channel.

A better comparison to satellite tv would be 20 oz. bottles of soda. The store may or may not decide to give me a better price if I wish to buy, say, 24 of them. But if I only want to buy a single bottle of Coke, they don't force me to buy a dozen bottles of various other brands to get that one bottle of Coke.


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## jrb531 (May 29, 2004)

Greg Bimson said:


> I was going to reply, point-by-point, to each issue in jrb531's post. Instead, I'll take simply the bottom part:You can. Go C-band. Except that you still have bundling of some channels. There is your option. If you don't like that option, no one must give you another option.They are businesses. Why should they have to? I don't go into 7-11, grab a small cup for soda, and fill it one-third of the way, and expect the price of the soda to be one-third of a full cup of soda.But there are business reasons.
> 
> You can get steak. You can get it at the grocery store, and cook it yourself. You can get it at Ruth's Chris. People walk into Ruth's Chris because of the level of expectation in service. Those people don't expect to walk into Ruth's Chris expecting to get a steak served as if the restaurant was a Sizzler.
> 
> Besides, if you really want to pay a la carte, why not sign yourself up as if you were an MDU? You have to pay commerical prices for the receiver, and you have to pay somewhat higher a la carte programming fees. The ability is there; you can use it. The issue is that you'll pay twice as much in total ownership costs than if you used the regular, residential pricing. Because no matter how many times I post this, you overlook it: everything costs more unbundled.


I fail to see the comparison. I fail to see why you try and defend these practices. They serve no one other that big business. I broke it down to that one question because IMHO there is no real answer other than greed.

The "fact" is that everyone would make $$$ if you subscribed to only one channel but not enough for big business so they FORCE us to pay for things we do not want.

This is not about a free market where they could charge whatever they want for that one channel but rather a denial of service. Since we do not have real choice as the programming content providers are allowed monopolistic practices when they "force" a take all my channels or you get none we are forced to seek government intervention to break up these practices.

People are all caught up in these examples and I will provide one more 

If I want ONE donut I will pay 50 cents for that donut or I can buy a dozen for $3 (25 cents each) but I still have that choice. Most people pay double for a single donut because they know the other 11 will go to waste as they can only eat one donut.

THIS is the correct example and if ALL (not just a few as you would go to another donut shop) donut shops started to ONLY to sell 12 donuts at a time and refuse to sell you only one then all hell would break loose.

Your example attempts to say that we should be able to buy half a donut.... let's stop all this mincing of words. Why are you really afraid of choice? If you want 10,000 channels then you pay for the product you want - don't make me subsidize your channels.


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## Greg Bimson (May 5, 2003)

I am not necessarily defending these practices. However, just like you want the ability to get a raise every year, companies are obligated by the shareholder community to increase profits by maximizing reveune and reducing expense.

My "one-third full cup of soda" example is simply providing a level of service and level of pricing. Fountain sodas are priced based upon maximizing revenue, not level of cost. The cost for the soda is a package: a 7-11 a cup, a lid, a straw, and the liquid poured into the cup. Non-direct expense is the overhead lights, refrigeration, employees, and rent/lease of space.

Does anyone think that packaging doesn't occur on a regular basis? Try this: you cannot buy just the sports section of the New York Times.

We also keep getting into this "technology" discussion. As in, there is no technical reason to sell a la carte. Well, let's just take a look at what the technology boom did, otherwise known as the internet boom. Shows promise, the technology will do everything, yet when it was shown that internet companies could not make money, they were no longer in business.

Everything is about a business reason. If it weren't, every company would fail.


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## Greg Bimson (May 5, 2003)

> Your example attempts to say that we should be able to buy half a donut.... let's stop all this mincing of words. Why are you really afraid of choice? If you want 10,000 channels then you pay for the product you want - don't make me subsidize your channels.


No, my example is simply stating that unbundling and rebuilding your programming to suit your needs will simply cause you to purchase 15 or 20 channels for more money than the current package.

I am not afraid of choice. I am afraid that you don't understand if the choice was finally available, that you won't like that choice either.


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## jrb531 (May 29, 2004)

Greg Bimson said:


> No, my example is simply stating that unbundling and rebuilding your programming to suit your needs will simply cause you to purchase 15 or 20 channels for more money than the current package.
> 
> I am not afraid of choice. I am afraid that you don't understand if the choice was finally available, that you won't like that choice either.


I think you are vastly underestimating how few channels people would really subscribe to if they could pick the half dozen or so that they really watch. I can but speak for myself but I watch maybe 6 channels aside from my locals that are spread over 3 different packages - they even admit to doing this to try and force people like myself into subscribing to all the packages. If I was able to pick just those siz channels I fully expect to not pay 50 cents per channel but maybe $3 per channel (6 times their package price) but by my math $3 time 6 = $18 a month and not the $50 a month I pay now for all three packages. Of course you can always counter they they will charge a zillion dollars per channel to make us not want to do ala-cart but I bet they could get into some real hot water if they got that blatent about it


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## jrb531 (May 29, 2004)

Greg Bimson said:


> I am not necessarily defending these practices. However, just like you want the ability to get a raise every year, companies are obligated by the shareholder community to increase profits by maximizing reveune and reducing expense.
> 
> My "one-third full cup of soda" example is simply providing a level of service and level of pricing. Fountain sodas are priced based upon maximizing revenue, not level of cost. The cost for the soda is a package: a 7-11 a cup, a lid, a straw, and the liquid poured into the cup. Non-direct expense is the overhead lights, refrigeration, employees, and rent/lease of space.
> 
> ...


I am not arguring about "logical" packaging even though I still firmly believe in ala-cart. You see there is no "logical" reason or association between the 3 traditional packages they sell. If they had a "sports" package or a "kids" package I would still want ala-cart as I am a firm believer in choice but I could at least understand that more. People who do not watch sports would not be "forced" to pay for it. People who had no kids would not be "forced" to pay for such programming etc...

What grates my teeth (and I think many others) is that the setup has a very statistical method and that is to put "just" enough "must have" programming in each package to "force" people to subscribe to programming they do not want.

EVERYTHING about the current system favors big business at the direct expense of the consumer. I understand that businesses want a profit but profit on products "I" want and not by forcing things on me that I do not.

Let's not get silly here and start using examples about half cups of soda or partial cartons of eggs. Packaging "like" items of daily consumables is a bit different than packaging a dozen channels of different subject matter.

Most of this is the fault of greed. If they wanted to compromise they would break the 3 package setup they currently have and make a "sports" package and a "kids" package etc.... which would keep the prices down a bit and offer people at least some choice. Those that object to some of the music video content would simply not subscibe to the "Music Video" package. Those that could not care less about talk shows would not subscribe to the talk show package.

I think you know what I mean. I would rather have full choice and be able to pick "only" the channels I want but if the industry would greatly expand the number of packages to allow partial choice I would be willing to compromise. Right now I see little from the other side in terms of compromise. They basically want things to stay the way it is.

Each time they add another channel to the 3 packages those packages go up and up and up in cost. One of the reasons prices are going up is because we keep making the packages have more channels instead of adding to the number of packages.

10 years ago you might have had 10 real channels per package and now you have 20+ per package. Why? Why is the industry locked into offering only three? I think we know why.... it makes us pay for more than we want - end of story.


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## Greg Bimson (May 5, 2003)

> Let's not get silly here and start using examples about half cups of soda or partial cartons of eggs. Packaging "like" items of daily consumables is a bit different than packaging a dozen channels of different subject matter.


Is it, though?

You are the one differentiating subject matter on channels. The fact still remains that content providers can negotiate with distributors to help set up which product belongs on which programming tier, and the cost for each of those channels. The pricing for channels can be negotiated for an entire program provider's slate of content, and is priced by availability on specific tiers. A la carte throws that out the window.

I still refer back to the original post in this thread. Those respondants would love to have a la carte if the pricing wasn't onerous, simply because they wanted to dump some channels because they feel as though the programming on them is offensive. I am simply stating that if a la carte is implemented, you could probably pick 7 channels, and pay 70 percent of the lowest package. If that isn't onerous, I don't know what is.

This is a completely moot point, until we hear anything, either from Congress or the FCC. Because unless:

1) the regulation stipulates each channel available a la carte from distributor to consumer
2) the regulation stipulates each channel available a la carte from program providers to distributors
3) the regulation stipulates a price ceiling for each channel from provider to distributor
4) the regulation stipulates distributors must offer a la carte programming to consumers
5) the regulation stipulates a price ceiling for consumers subscribing to a distributor

And this is considered free market?

Unless someone wants to take the content providers and the distributors to court for "monopolistic practices", no law will ever be addressed to allow a la carte.

If anyone wants a la carte that badly, they need to go to court and prove the current business environment is in violation against current anti-trust laws. That is the reason why NFL Sunday Ticket is now available weekly.

We can all talk a good game. Complaining to the court of public opinion might get these issues off of anyone's chest. Filing complaints to the court of law might actually get something done.


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## jrb531 (May 29, 2004)

Greg Bimson said:


> Is it, though?
> 
> You are the one differentiating subject matter on channels. The fact still remains that content providers can negotiate with distributors to help set up which product belongs on which programming tier, and the cost for each of those channels. The pricing for channels can be negotiated for an entire program provider's slate of content, and is priced by availability on specific tiers. A la carte throws that out the window.
> 
> ...


Well it is my hope that some of this discussion is being read by those in power to do something about it... maybe not.

Either way I guess we have to agree to disagree here. I think that "I" should be the one who picks what channels I want to pay for and others think that we should take whatever is shoved in our direction and be happy for it


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## kb7oeb (Jun 16, 2004)

I think it is still a free market. If it really bothered people that much they wouldn't pay for it. I am one of those people. I can not buy the handful of basic channels I want so I don't buy them at all. Dish will sell me hbo and showtime without requiring anything else so I do buy those. 

If they are going to look at monoplistic practices maybe they should start with Disney and their requirement that their expensive espn channels be provided in the basic packages.


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## SimpleSimon (Jan 15, 2004)

I thinnk I posted earlier, and has been mentioned often here, that a mini-package concept could very well be the best of both worlds.


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## Greg Bimson (May 5, 2003)

Yes, but the example bandied about is the Canadian example. Even there, both Star Choice and Bell ExpressVu require the "basic" package, prior to ordering mini-packages.


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## jrb531 (May 29, 2004)

Greg Bimson said:


> Yes, but the example bandied about is the Canadian example. Even there, both Star Choice and Bell ExpressVu require the "basic" package, prior to ordering mini-packages.


I'm not against a basic package as long as it includes all the cheap stations. Put ESPN and Disney in the basic package and you kill it IMHO.


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## jpurkey (May 15, 2003)

Greg Bimson said:


> ... I am simply stating that if a la carte is implemented, you could probably pick 7 channels, and pay 70 percent of the lowest package. If that isn't onerous, I don't know what is. ...


And if someone only watches 7 channels they are still saving at least 30%.

However, I do watch more than 7 channels, which is why I'm more in favor of a system that still includes a base package with the cheap, free and paid-to-be-carried (ie: shopping) channels. If they just stop forcing me to pay for the expensive (AKA greedy) channels I'd be happy.


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## jrb531 (May 29, 2004)

jpurkey said:


> And if someone only watches 7 channels they are still saving at least 30%.
> 
> However, I do watch more than 7 channels, which is why I'm more in favor of a system that still includes a base package with the cheap, free and paid-to-be-carried (ie: shopping) channels. If they just stop forcing me to pay for the expensive (AKA greedy) channels I'd be happy.


Same here... I would take the base package (if it contained all the cheap channels) and add a few channels to it. I suspect many others would do the same.


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## TBI (Sep 29, 2004)

C-band "A La Carte" pricing is alive and well.
The only way Dave & Charlie may begin to listen is if we vote with our dollars, I realize everyone does not have room for a large dish but if allot of us move from them to C-band they will have to consider A La Carte to stay competitive.
With C-band you have a choice of who you purchase your programming from without changing your equipment.
Actions speak louder than words.

http://www.callnps.com/alacarte.htm
http://www.programming-center.net/Webform1.aspx
http://skyvision.com/programming/alacarte.html
http://www.bigdish.com/satala.htm

http://www.4dtvforum.com/index.php


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## SimpleSimon (Jan 15, 2004)

Welcome aboard TBI!

As a former C-Band user, I understand what you're saying, but it's never gonna happen. A new install is way too expensive - or simply not possible (city people), so only those that still have a working BUD might do it - and there's just not that many.


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## TBI (Sep 29, 2004)

Thank you, Simon
I thought I would just put the information out there, someone may have a BUD in the yard of a house they just bought who did not realize the opportunity for higher picture quality. 
The expense does not seem to be significant; I just purchased a used General Instrument DSR-922 4DTV (analog & Digital) receiver for $250. and a C/KU feedhorn with LNB’s for $55.
I am in the process of locating a used BUD to relocate to my property that will involve more labor than money. I should be able to locate a dish for free if I remove it.


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## SimpleSimon (Jan 15, 2004)

If you're in Colorado, they're all over the place. You could get 4-5 of them for free within a 5 mile radius of my house.


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## ehgreen (Nov 23, 2004)

When I struggle over 'a la carte', my model shifts to Daily Newspapers. Whether you pay 50 cents or a Dollar per day, you get a Bundle, that you can't purchase as individual sections.

The value of the package is that it provides MANY different sources, some that I read, and many that I don't. There is economic advantage in delivering it all together.

Of course, there are specialized newspapers, some daily, some weekly. Narrowcasting for those who want to specialize, shed topics not of interest, etc. Some of these are widely known (WSJ, Sporting News, Electronics News, Variety) and some are even free (trade pubs). But even here, there are articles or sections not of interest, but you accept them as part of the Bundle.

Perhaps a solution is to "cherry pick" from varied video suppliers.

I have Basic and HD Digital Cable, with a DVR in the set top box, not the standard Analog cable channels. For about $35/mo including the box, I get 22 network and Public Access / PEG analog stations, the regional cable news channel, plus 10 digital movie, 10 other digital cable channels, no sports, and audio music, including 3 classical channels.

I have E* locals in local, which cover areas in my DMA not on cable because they are "far away", West Coast Networks (for time shifting), National PBS, 18 Public Interest Channels (2 University Channels, FStv, Performing Arts, World Link, C-Span-1, NASA, etc) for $17/mo. Plus on all their promo and sales channels, religious, etc.

And DTV with only the "choice" top layer (Bio, NYTimes, Hallmark, HistIntl, NatGeo, & others), their Public Interest Channels, distant networks, and HBO Bundle at $27/mo.

The only programming I know I would "buy" a la carte would be C-Span-2, Fx, and maybe TCM. But in packages, they are WAY too expensive.

So Pick and Choose, and you may find your bill is more affordable.


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## ehgreen (Nov 23, 2004)

Greg Bimson said:


> This is a completely moot point, until we hear anything, either from Congress or the FCC. Because unless:
> 
> 1) the regulation stipulates each channel available a la carte from distributor to consumer
> .. .. .. ..
> We can all talk a good game. Complaining to the court of public opinion might get these issues off of anyone's chest. *Filing complaints to the court of law might actually get something done*.


Thank you for this good post!

My B-school Law classes talked about several Anti-Trust "waves" in this country. Who remembers that "tying" products is illegal, unless there is some economic justification [you must buy A to get B]?

Ford can't be forced to Unbundle the motor or wheels from a car. A working machine is a logical deliverable. BUT you can buy wheels or motors from Ford a la carte. Or from an aftermarket supplier!

In the Multi Channel Supplier market (cable and satellite) we can see MANY examples of tying activities -- such as the Echostar vs CBS - Viacom bundle discussion last spring. So how can Content Providers get away with requiring the MCS community to take Bundles?

Until that is resolved, think there will be no solution for the viewers. Is there an exemption in FCC regs or statute that exempts Content Providers? Maybe, as stated above, all that is needed is a Private Party to SUE?

I think a class action, with potential for trebled damages as an Anti-trust matter, could be quite interesting!


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## Big Bob (May 13, 2002)

I only watch one show on CBS, so why should I be forced to buy the whole channel?

I want to have the ability to only purchase the one show that I watch.

All of the arguments for a la carte can be taken to the next step. 
Why should I have to pay for all of the shows on one channel that I don't want just to get the one that I want?

think about it


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## SimpleSimon (Jan 15, 2004)

I agree - we should take ala carte all the way to the PPV level. It works for movies and special events, why not 'normal' series?

Let me buy only the shows I want from each network.


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## BabaLouie (Apr 2, 2004)

ehgreen said:


> I have E* locals in local, which cover areas in my DMA not on cable because they are "far away", West Coast Networks (for time shifting), National PBS, 18 Public Interest Channels (2 University Channels, FStv, Performing Arts, World Link, C-Span-1, NASA, etc) for $17/mo. Plus on all their promo and sales channels, religious, etc.


How do you get this assortment of channels? E* won't give me the public interest channels you mentioned (except for NASA) unless I sub to Top 60 or higher package. They will sell me a package of distant networks from any two of four cities (locals aren't available here). National PBS is thrown in for free with one of those packages. If I don't subscribe to Top 60 or higher package, I have to pay an extra surcharge on top of what I pay for the network package(s).



ehgreen said:


> And DTV with only the "choice" top layer (Bio, NYTimes, Hallmark, HistIntl, NatGeo, & others), their Public Interest Channels, distant networks, and HBO Bundle at $27/mo.


How do you get this assortment of channels? DTV tells me I must sub, at a minimum, to their Total Choice package...I think it runs about $36-$37/month.


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## narnia777 (Mar 28, 2003)

BabaLouie, thanks for asking I too would like to know how he got those channels from both E* and D*... 

On E* I get the Superstations $5.99, Fox E/W (waiver) $3, Encore only package $4.99 and I pay for Sky Angel.

I pay $13 for standalone Tivo to run my 301 for Dish and Sky Angel.

On D* I get TC+ and locals with Tivo for $48.

I would love to get smaller packages on E or D and be able to pick channels I watch most.

Jim


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## jpurkey (May 15, 2003)

SimpleSimon said:


> I agree - we should take ala carte all the way to the PPV level. It works for movies and special events, why not 'normal' series?
> 
> Let me buy only the shows I want from each network.


That would be fine if I could still buy whole channels. There are some channels which I watch so often than a PPV system would be way too expensive. Also, I think I would be annoyed at having to watch commercials after having paid for a program. Maybe they could offer commercial free versions of programs PPV? Though since I can already edit commercials out of DVD Recordings, so I'm not sure how much value it would be to me.


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## Big Bob (May 13, 2002)

jpurkey said:


> I think I would be annoyed at having to watch commercials after having paid for a program.


Unless you are watching with an over the air antenna, that is exactly what you are doing now


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