What we pay for cable channels

[TexasTom]

And you don't honestly think that the NFL would choose to end Monday Night Football if it didn't get what it wanted for rights fees? Or that the distributors of said syndicated programming wouldn't just say "you know, thats not worth it to us"? How about original programming like Psych? How cheap can that be produced? And if you don't have wide distribution, ad rates suffer too.

Actually, no I don't think that would happen. The NFL was getting $500 million/year for Monday Night Football when it ran on ABC; that increased to a cool billion when it moved to ESPN. The NFL, understandably, went with the most profitable deal based on the current market place. But if the market changed, there's no reason to expect them to withdraw MNF because the rights fees go back down to $500 million. That's still profitable...just not as profitable as it currently is. Same thing with syndicated programs --selling rerun rights for CSI at $1 million/episode instead of $2 million/episode is still profitable...just not as profitable as what they're currently getting.

My point is that in an a la carte world, while some programs would almost certainly disappear, there's no reason to believe that the drop would be as catastrophic as a la carte opponents claim. But what would happen is that the profitability of content suppliers would drop substantially.

If Ala Carte was a good option for consumers, or a highly demanded one, cable companies would offer it. But it isn't, plain and simple. And if it benefited the consumers, you don't think some city council SOMEWHERE would have conditioned renewal of the contract for service on that?

Um, no. The contracts that cable and satellite companies sign with the programming networks preclude them from offering a la carte service. Consequently, it isn't offered, regardless of whether some cable companies (or city councils) might like to offer it as an option -- if it comes to a choice of offering your viewers a la carte but losing major networks like ESPN, TNT, and USA, what do you think the choice will be?

And that has nothing to do with market demands...and everything to do with the contractual arrangements forced on cable and satellite companies. Why those contracts are allowed is a mystery to me...it seems that they should be tossed out, just as "block booking" by movie studios was back in the fifites.

 

[justpassingthough]

Enjoy your farmer stories, but realize they're completely and utterly dissimilar.

Military people study battles going back thousands of years. Surely in the 21st Century it makes no sense to study some battle from 1,500 years ago fought with swords but those who quality to be military LEADERS have the ability to see parallels.

What a waste of time when Christian people gather on Sunday to hear sermons about the folly of building houses on foundations of sand and parables of men of agriculture reaching into a knapsack to get a handful of grain and fling it out where some lands on fertile soil and some lands on rocks. But they keep repeating those ancient, out-of-date stories because they come alive in the minds of some people who can see 21st Century applications.

Unfortunately, the movers and shakers of Wall Street in the 21st Century saw absolutely no need to pay attention to stories of financial catastrophes in 1929 and earlier times. After all, we know we all sit in little cubicles today with wires to everywhere and what happened in 1929 cannot possibly happen in 2008-2009-2010.

If you cannot connect the dots between a farmer in the 1800s choosing between paying Mr. Rockefeller or riding miles and miles with someone like myself contemplating paying the cable company or dealing with multiple resources and personally managing those resources to evade the monopoly.... I'm truly sorry the educational system did not instill an appreciation and understanding of history into your life.

Your story about the farmer has no bearing, because you're speaking of opportunity costs- of which they are not any relatable opportunity costs that parallel in the cable/satellite industry. If an individual wants to switch between cable or satellite, the costs are relatively affordable and the time spent switching is relatively minor. That is where your analogy goes off the rails.

 

[Goat Rodeo Cowboy]

Your story about the farmer has no bearing, because you're speaking of opportunity costs- of which they are not any relatable opportunity costs that parallel in the cable/satellite industry. If an individual wants to switch between cable or satellite, the costs are relatively affordable and the time spent switching is relatively minor. That is where your analogy goes off the rails.

I thought the thread had developed to the point we were discussing how one would define a monopoly. The fact that one monopoly may place a very low barrier (opportunity costs?) on a consumer compared to the high barrier imposed by another monopoly does not excuse the behavior or facts regarding the "low barrier monopoly".

It's like being pregnant. Either you is or you is not a monopoly. The height of the barrier does not change the definition. It only changes the aggravation factor.

I live in an area with what has been described as the second worst rush-hour traffic in America. If a man and wife are both employed and someone has to miss a day of work to be present for the install of an alternate source of TV programming, the "opportunity costs" of trying to escape the cable monopoly do begin to add up. Let's revisit our (present day) farmer in Scott City, KS or maybe a production line worker at the gear factory in Subiaco, AR. Arranging for an alternative to cable in these rural, somewhat isolated communities may be a bit more oppressive than you are willing to admit.

 

[LKellerIII]

Your story about the farmer has no bearing, because you're speaking of opportunity costs- of which they are not any relatable opportunity costs that parallel in the cable/satellite industry. If an individual wants to switch between cable or satellite, the costs are relatively affordable and the time spent switching is relatively minor. That is where your analogy goes off the rails.

I thought the thread had developed to the point we were discussing how one would define a monopoly. The fact that one monopoly may place a very low barrier (opportunity costs?) on a consumer compared to the high barrier imposed by another monopoly does not excuse the behavior or facts regarding the "low barrier monopoly".

It's like being pregnant. Either you is or you is not a monopoly. The height of the barrier does not change the definition. It only changes the aggravation factor.

I live in an area with what has been described as the second worst rush-hour traffic in America. If a man and wife are both employed and someone has to miss a day of work to be present for the install of an alternate source of TV programming, the "opportunity costs" of trying to escape the cable monopoly do begin to add up. Let's revisit our (present day) farmer in Scott City, KS or maybe a production line worker at the gear factory in Subiaco, AR. Arranging for an alternative to cable in these rural, somewhat isolated communities may be a bit more oppressive than you are willing to admit.

You've got a point, though I doubt that "aggravation factor" is a legal consideration in determining what businesses constitute monopolies. This is why these companies entice us with "introductory offers." They know if they can get us to switch, we'll probably be satisfied enough with the service to not switch back when the offer ends, and our bills go way up.

In my case, this is actually hurting my local cable company. I have Comcast for TV, but AT&T for internet and landline phone. I've been thinking of trying to save money by "bundling" with Comcast, and switching over to them. Comcast's internet is reportedly faster. But then I have to wait around for the installation guy, and I'd have to lose my current AT&T email address, which I've been using for years. So far, the potential savings have not enticed me to go to all that trouble.

 

[TheBigA]

Either you is or you is not a monopoly. The height of the barrier does not change the definition. It only changes the aggravation factor.

Keep in mind that it isn't up to the public to define a monopoly, but how the courts see it. Being the only provider isn't seen as a monopoly until a company uses that advantage to cheat the public. The government keeps a close watch on how cable companies use their power, and that's likely to increase. In addition, local governments have used this as justification to allow telecom companies like AT&T and Verizon to enter the home video business. So now, in addition to cable and satellite, consumers in more than 20 states have the choice of services like FIOS.