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December 3, 2007

A la carte TV pricing will come -- on the Internet

More attention was focused on Chairman Kevin Martin's defeat in an attempt to impose stiffer cable-TV regulations at the FCC last week than on what those regulations are. Martin tried to invoke the "70-70" rule, which gives the Federal Communications Commission tighter control when cable companies reach 70 percent of the nation's households and 70 percent of THOSE homes subscribe to cable. Martin said we've reached that point. No we haven't said the industry, loudly complaining. Martin's study showing 70-70 liftoff looked a bit forced, anway, so it's not going to happen.

What he wanted to do was allow cable TV customers to buy channels "a la carte" instead of in the bulk, prix fixe manner that the cable companies and the TV evangelists prefer. You want ABC and Ugly Betty? OK, but you have to buy Joel Osteen and the bass-fishing channel and QVC as part of the same package. Cable companies hate a la carte because it would hurt their cash flow and profits and diminish their leverage with content providers. But you can already get many shows a la carte -- on the Net. They're free now. But look for technology to improve, Net video to get better and networks to consider start to charge for Net viewing. The process will take a while -- and may prompt food fights with cable-broadband companies who will get mad that networks are piping programming behind their backs on their own fiber. But I bet it will happen for certain premium content before there are any a la carte menus from traditional cable-TV outfits. Then maybe it will force the cable companies to offer their own a la carte as a defensive move.

Posted by Jay Hancock at 9:10 AM | | Comments (0)
        

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About Jay Hancock
Jay Hancock has been a financial columnist for The Baltimore Sun since 2001. He has also been The Baltimore Sun's diplomatic correspondent in Washington and its chief economics writer. Before moving to Baltimore in 1994 he worked for The Virginian-Pilot of Norfolk and The Daily Press of Newport News.

His columns appear Wednesdays and Fridays.
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