"Consumers lose with ‘unbundled’ cable service" by Josh Barro | New York Times May 17, 2014
If you have cable TV, you probably do not watch most of the channels you get.
Certainly not the cable news networks.
Sorry.
The average US television household receives 189 channels, up from 123 in 2003. But viewers are watching only 17.5 of those channels — nearly unchanged from 11 years ago, according to a new report from Nielsen.
I guess that is about right, although I would hazard about 25 because I'm real picky.
It would be great if you could pay just for the channels you actually use, right?
That is the idea behind “unbundling,” which some consumer groups have advocated. Cable companies would sell you individual channels rather than vast packages of them. It is an easy idea to get behind when cable companies, never the most lovable of service providers, are raising prices and merging.
Which is the opposite of what we were told would happen, but okay.
But surprisingly, unbundling cable channels would not make consumers materially better off. The most likely result would be people paying about the same amount for fewer channels.
It's like the price staying the same at the supermarket but amount of product being smaller. And the government does not see that as inflation! Any way you cut it, it is LE$$ PURCHA$ING POWER!
Think about what you would do if your cable service were unbundled. Maybe you watch a lot of CNN, Comedy Central, Bravo, A&E, and TLC, so you would buy just those five channels.
Or maybe you think A&E and TLC are pretty similar. Given a cable system that includes both, you watch some of each, but if you had to pay separately for each, you’d just make do with one. So you would be buying just four channels.
I'm not trying to be picky or take over the remote, BUT is not the proper word DUE there?
I stand corrected; I'll chalk up my personal failing to style. I pointed out all the grammatical mistakes by the legendary writers in a literary class once, and the instructor said it is overlooked because the story is so good. She said they called it stylized writing or something.
Glad I could unbundle myself with that confession.
You would lose some things of value here.
Is there anything of value on TV?
Along with TLC, you would drop some channels you used to watch occasionally, like Discovery. If your brother used to come over and watch a couple of football games a year on ESPN, he would not be able to do that anymore.
But you would be paying a lot less with so few channels on your bill, so you would be happier despite the loss of some content — assuming prices per channel stayed the same.
(Blog editor turns off TV via remote)
But now consider what would actually happen to prices.
The cost of maintaining the wires to your house and keeping the lights on at the cable company would not go down, even as you order fewer channels. It costs just as much for the cable company to deliver four channels as it does 189. There is good reason to expect your cable company to raise your basic service charge to cover those expenses, offsetting part of your per-channel savings.
And consider how the cable channels would react. The networks make money in two main ways: They get per-subscriber carriage fees from the cable companies that distribute them, and they sell advertising. Ad revenue would fall a little, as some viewers dropped channels. The number of customers subject to carriage fees would plummet as consumers ordered fewer channels.
Meanwhile, each channel would know its remaining subscribers are mostly people who actually watch, meaning they have a high willingness to pay. Knowing this, they would raise carriage fees — a lot.
In a paper published in 2012 in the American Economic Review, the economists Gregory Crawford and Ali Yurukoglu estimated that, under a mandatory unbundling system, channel carriage fees would about double. They found the average customer would end up spending slightly more on cable under an unbundled system, while watching slightly fewer channels.
On the other hand, some people who currently do not get bundled cable at all would take the opportunity to buy a few channels. Since those new entrants would be better off, Crawford and Yurukoglu estimate that unbundling would slightly benefit consumers, raising the value of the typical cable service by 0.2 percent.
But they note that is before accounting for the fact that unbundled packages would cost more to market and deliver.
Not everyone would lose out. For example, if you never watch sports, you might be better off not having to pay for ESPN, which charges the highest carriage fee of any basic cable channel. But Byzalov estimates that sports channel carriage fees would more than triple under unbundling, as most subscribers opt out and only die-hard sports fans buy in. Consumers who do not care about sports at all would be better off, but casual sports fans would be worse off.
All of this is counterintuitive. Packaging a product so you are mostly buying stuff you do not want seems as if it should be bad for consumers. And I’ve pointed out the advantages of unbundling in other areas of the economy, like Frontier Airlines’ new fee for carry-on baggage.
Related: Frontier Airlines now charging for carry-on bags
Cancel that flight.
If I put my bag in an overhead luggage bin, you can’t put your bag in the same spot, so it makes sense to charge me personally for my use.
But not everything should be unbundled. When a good is “nonrivalrous” like a cable signal, giving it to me does not stop anyone else from using it or add production costs at the margin. In those cases, it can make sense to throw lots of stuff into one package, regardless of whether I’ll actually use it.
Why did the stacks of unread, half-read, and quarter-read Globes just pop into my mind?
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I see a threat on the horizon; terrorists might cut off TV!
"Industry sees threat in Comcast-Time Warner deal" by Edward Wyatt | New York Times May 09, 2014
WASHINGTON — David L. Cohen, a Comcast executive vice president who has been the company’s leading public advocate for the deal, said he understood the opposition but it was misguided....
“Putting any emotion aside, this transaction must be viewed by reference to the facts, sound economic theory, and the law,” Cohen wrote in a company blog post Thursday. “And on that basis, we believe that any anti-competitive risks are soundly outweighed by the pro-consumer benefits.”
Representative Spencer Bachus, Republican of Alabama, chairman of the House antitrust subcommittee led by Republicans who are often sympathetic to business interests, said in an opening statement that while size alone does not necessarily lead to anticompetitive behaviors, “it can result in an ability to influence markets in anticompetitive manners.”
Like BANKS too big to jail?
If the companies combined, the new entity would be the primary pay television provider in 37 of the top 40 markets, Bachus said, and would account for 40 percent of the nation’s broadband customers.
Nevertheless, he added, companies including Comcast have invested heavily in new technologies, to the benefit of consumers.
“If there is any industry in America that has undergone a revolution in the past 20 years,” he said, “it is the cable and video business.”
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I'm told “this merger is less about cable than it is about the future of the Internet,” which I will be getting to in the near future.
I know there are more articles out there they I have not gotten to or not read, and I may not patch them in here. I'm unbundling myself this weekend. Sorry.
Related: Canceling Comcast
Once the net is no longer neutral neither you or I may be here, and it really doesn't matter. The propaganda genie isn't going back into the bottle even as the beach ball swirls, and I'll never see my ma$$ media the same ever again. Nor will I ever believe in them again. They have had more than enough time to reverse their Titanic of an indu$try and $imply plowed ahead with outrageous obfuscations, damnable distortions, and lapdog lies.
Wow, I feel a lot better, as if I've unburdened myself a bit. Thanks, readers.
UPDATES:
Comcast earnings increase 26%
Net income in three months: $1.91 billion
Yeah, that is with a B!
AT&T-DirecTV deal could level playing field
Back to the Big 3 networks just like when I was growing up.
