Saturday, November 16, 2013

Musings on the state of TV

This post is inspired by this article from the Washington Post about a new proposed bill that would increase the access that online video services have to the programs currently provided on cable and satellite.  This comes on the heels of another bill proposed a few months ago that would require cable and satellite TV providers to give their customers the option to pick channels a la carte - i.e., individually, and not in a bundle.  These are relevant proposals as more and more Americans are "cutting the chord", or dropping their pay TV subscriptions, and using online services like Netflix, Hulu, and Amazon Prime.

Being a member of the segment of the population that does not watch much TV (in fact, the only TV I seem to watch these days is Premier League soccer on NBC Sports), I would welcome increased content choice and access via online services.  However, I seem to have a philosophical objection to regulating this into being.

It seems to me that if a la carte channel selection is something that customers are increasingly clamoring for, then smart providers would realize this and begin providing such options in order to increase their share of the market.  Of course, we must consider that a cable/satellite company will likely make much more money off an individual customer subscribing to a bundle than choosing a few individual channels.  But at some point customers should start voting with their wallets, and drop the expensive bundles that they greatly under-utilize.  The question, then, is what customers have as an alternative.

I guess this is where increased access for online video services plays a part.  Ideally, the Youtubes and Netflixes and Amazons should be able to strike content deals that make sense for them and their customers without the government dictating the terms.  Here, I'm less sure whether such access would be possible without regulation - content providers probably have a financial incentive to keep the deal structures that are favored toward cable and satellite companies.  I would still like to believe that the market can work out that increased access is better business.

Another issue that comes up in this discussion is that of net neutrality.  If online video services are allowed access to content that is currently exclusively provided by cable and satellite companies, the cable companies (who also happen to be the major broadband Internet service providers) may have an incentive to reduce the quality of service for the online video providers.

So it seems that there are several factors that are currently tipped in favor of cable providers especially.  Ideally, I would love to see things like a la carte channel selection and online content access come into being due to market forces and without regulation.  But, similar to my feelings on municipal smoking bans, if it takes a bit of legislation to nudge things in that direction, I won't complain too loudly.

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