The Failure of a la Carte Cable is a Boon for New Media

A la carte cable is an idea that’s currently being promoted by the FCC, but it’s not exactly new. It refers to cable provider’s offering a cable system based on choice, rather than expensive packages where there are only a handful of worthwhile channels. I’m sure I’m not the only one who’s tired of paying $50 a month for a service that I barely find any value in. And yet, it’s the only way to access the occasional standout cable channel like Comedy Central, USA, or Sci Fi. When faced with a surely broken system such as this, the notion of a cable service where you pay only for what you want seems like an utopian dream.

Ever the dreamer, a la carte cable is something I’ve argued for among friends and other columns for the past few years. That is, until I came across this article by Joe Nocera at the New York Times. Nocera argues that a la carte cable is something that sounds wonderful in theory, but it actually falls apart when you consider the intricacies of cable’s astoundingly weird economics.

While I was sad to see that I was wrong this whole time, it quickly occurred to me that a la carte television isn’t truly dead–it will just be on our computers instead of our televisions. After all, isn’t it the very essence of new media?

Before I go on a new media rant, lets look at why exactly a la carte cable was never meant to be. Nocera mentions a 2004 F.C.C. study commissioned by then chairman Michael Powell:

To the surprise of many — including, I’m told, Mr. Powell himself — the study concluded that à la carte would have the exact opposite effect from what its backers claimed. Instead of reducing prices, à la carte would cause cable bills to rise for most people. And it would cause many channels to go out of business.

Why is this the case? In short, Nocera posits that cable channels will actually get more expensive when unbundled from the megapackages currently favored by cable companies. Since the networks charge the cable companies based on their total amount of subscribers to the cable package, that price would surely skyrocket in an a la carte world. Smaller networks that can’t acquire a decent amount of subscribers will simply die off.

New media is already living the a la carte dream. Youtube, College Humor, and all the other popular video sites let you control exactly what you want to watch. The move towards streaming network television shows online is making television less of a necessity for prime time fans. And services like Joost will give us even more of a television-like experience over the web.

Combine streaming video services with the multitude of ways to purchase digital content online and you have a recipe for the next evolution of television–precisely what a la carte cable would have been. This is even more apparent to geeky media types like myself who already watch all of this content on their televisions. Devices like the Apple TV, combined with digital content integration into traditional television devices like Tivo’s ability to download shows, offer us all a reason to forget about cable entirely.

I don’t think new media will kill cable television any time soon, but the potential is surely there in the long run. Cable will slowly adapt by adopting new media-esque characteristics like more on-demand content, downloadable content, and social services, until it’s basically a television interface for new media.

When that reversal occurs, at least there will always be something good on.

Devindra on December 5, 2007 Subscribe to our RSS Feed