As a rule, consumers don’t like paying for things they don’t enjoy. Even so, despite the widespread consumer desire for an a la carte model, in which pay TV customers could select (and be charged) only for the channels they want, the bundle remains standard. What this means is that pretty much all pay TV customers are paying for channels they don’t watch—and who wants to cough up money for a service they don’t use? The customers who get the rawest deal of all with the pay TV bundle are the folks who have no interest in sports.
According to the New York Times, the average American pay TV subscriber winds up dropping roughly $100 annually strictly for sports programming. So if you’re wondering why your cable bill is so high, blame ESPN. (Or, perhaps, blame your cable provider and ESPN.)
ESPN is the unchallenged heavyweight champ of cable; it’s so popular that by next year, each pay TV household will be charged over $5 a month just for that main channel. When ESPN’s other channels (ESPN2, ESPN Classic, etc.) are added in, each subscriber winds up paying over $6.50 a month. The next-highest pay TV channel is TNT, which has been pulling in just $1.16 per month in 2011.
When fees and the costs of other sports channels are tallied, the average subscriber pays around $100 for sports per year. The question many non-sports fans surely would like to ask pay TV subscribers is: Can I pay $100 less by opting out of all sports programming?
For that matter, there are plenty of sports fans who wished that no part of their monthly pay TV bill was earmarked for channels they have no interest in (Lifetime, Hallmark Channel anybody?). Certainly, many consumers have interest in a pay-per-channel model, and demand for such an option will only grow with the rising costs of the pay-TV bundle. As a post in the Atlantic recently put it:
Cable executives worry that these high fees will lead to de-bundling, as younger people want cheaper à la carte packages.
Despite a prediction for 2011 being the year of the cord cutter, the vast majority of households are still pay TV subscribers. But pay TV providers know that customers want more control over what they’re buying. The number of different packaged bundles from Comcast always seems to be expanding, and, starting last year in select markets, Time Warner Cable began offering a cheaper TV package without ESPN, TNT, Fox News, Comedy Central, and other poplar and pricey channels.
The “unbundling” of pay TV may not happen the way all customers want, however. Cable and satellite TV providers are interested in a la carte models not because they would lower payments made by customers—that’d obviously be bad for business—but because they bring about the possibility of charging extra for certain channels and programs that are especially in demand. As IT World reported:
The upshot is that cable companies would like the option of creating a la carte menus they can use to shift more expensive channels into a semi-premium category that would carry extra costs, while leaving all the other channels in their same old bundles.
It seems like consumers will get some form of pay-per-channel TV as an option, and probably sooner than later. What will such a model look like? How much will channels cost? And will the new form of pay TV be any better than the old bundle? It can’t be worse than paying for dozens, perhaps hundreds, of channels you never watch, can it?