We here in the USA certainly have no shortage of options when it comes to when it comes to a lot of things, including our TV viewing preferences. I suppose it’s a nice problem to have. It’s a luxury actually.
According to Nielsen’s forthcoming Advertising & Audiences Report, the average USA home with a TV now receives 189 TV channels, which is a record high as well as a significant jump since 2008, when the average home received 129 channels.
Despite this increase, however, according to Nielsen’s report, consumers have consistently tuned in to an average of just 17 channels, even though they are paying for the full lot of 189, the vast majority of which will never be watched (see above chart).
I think I speak for many consumers when I say that most want to choose the channels they pay for from their pay-TV providers – the so-called a la carte pricing that you’ve probably all heard politicians like John McCain push for recently.
Will that ever happen? I think so; There’s certainly resistance to it from the providing companies, whose business model would be undermined. But I believe it’s only a matter of when, not if.
Media executives have long resisted calls for a la carte pricing because the financial underpinnings of their companies rest on the enormous revenue generated through cable subscriber fees and advertising sales.
To start, it’s been a challenge to figure out what the cost of a switch to a la carte programming will be to the industry overall. Estimates says that anywhere between $80 billion to $113 billion annually would be at stake, as smaller channels would disappear, only about 56 channels would survive, which would then lead to a loss of jobs that could run into the millions, billions of dollars in TV advertising would be at risk, and more.
But the loss of jobs, billions of dollars in annual taxes, and even the probability that the costs to the consumer will likely be higher to compensate, etc, none of that will likely be enough to put an end to calls for a la carte programming in the USA. In fact, they will likely only increase. The Canadians are 1 step ahead of us, as the government there has already demanded a la carte packages in Canada, asking TV companies to unbundle TV channel packages by the end of this year.
I haven’t had cable TV in a very long time. I find it a needless expense. And the continued proliferation of content distribution and exhibition platforms, allowing me to consume content when and where I want to, has certainly been enough to keep me sated. And thus I’m not entirely sure that an unbundling of channels offered a la carte will make much of a different in my viewing habits.
Your thoughts?
