[I think the "estimated" a la carte prices presented in this story are
WAY too high. With real al la carte, channels will have to price based
on what customers are willing to pay. Right now many high-priced
channels are subsidized by large numbers of subscribers who don't want
the channel but are required to pay for it anyway in order to receive
the channels they do want. In the public sector this would constitute a
tax. In the private sector we can characterize it as extortionate
collusion among a market cartel.]
How much would it cost to get your favorite channels a la carte?
*Mark Fahey & Eric Chemi **
**CNBC.com**
**
**Wednesday, 6 May 2015 | 3:26 PM ET*
http://www.cnbc.com/id/102654159
Americans are tired of flipping channels.
Viewers only use a small handful of the dozens of channels they pay for
in traditional cable bundles. "Slim bundles" focusing on a smaller
selection of channels are becoming more popular, but many analysts
believe the economics of the cable industry will make true "a la carte"
channels impossible.
That's because most people paying for a given channel—say, ESPN—aren't
actually watching it, and those people are helping subsidize the cost
for those who do.
As the cable industry meets this week in Chicago for its big annual
convention, CNBC Digital decided to run the numbers. If we assume that
only those who watch a channel would buy it a la carte, we can calculate
how much those viewers would have to pay to maintain the same
per-subscriber revenue that bundled channels like ESPN enjoy today.
For example, 24 percent of cable subscribers watch ESPN, according to
Nielsen data, but all cable subscribers pay $6.04 to have that channel
in their bundle, according to data from SNL Kagan. If only that 24
percent paid, they would have to be charged $25 each.
Here's how the math works out for 87 other cable channels, with those
that are either more than $8 a month when unbundled or have less than 3
percent viewership highlighted in red.
Most expensive unbundled channels: $248Least expensive unbundled
channels: $16Unbundled channel prices (hover fordetails)Other
channelsOver $8 or less than 3% viewershipESPN Classic Discovery Familia
ESPN NFL Network FOX Sports 2 FOX Deportes Discovery en Español FOX
Sports 1 Al Jazeera America NBA TV MLB Network Golf Channel NUVOtv FOX
News TNT FOX Business Netwo…ESPN2 Velocity FXM ESPNU NBCSN Sportsman
Channel CENTRIC Cloo VH1 Classic CNBC Chiller Nick Jr./NickMom MTV
Esquire Network Sprout USA Outdoor Channel TeenNick TBS Ovation TV One
FXX Nickelodeon/NAN IFC FUSE SundanceTV FX Network BET MSNBC Spike TV
OWNDiscovery Channel BBC America Nat Geo WILD Boomerang DIY Network
Bravo National GeographicCooking Channel Lifetime Television VH1
Nicktoons GSN ABC Family Channel AMC Cartoon Network Syfy LOGO
Destination America WE tv A&E Oxygen Network American HeroesMTV2 TV Land
Comedy Central CMT Galavision Travel Channel History TLC Food Network
The Weather Channel Lifetime MovieInvestigation Disc.H2 WGN America HGTV
GACAnimal Planet Hallmark Channel Hallmark Movie$0$5$10$15$20$25$30$35$40$45
If Americans chose 17 channels a la carte—the number that they actually
use—their "a la carte bundles" would cost between $16 for the cheapest
channels and $248 for the most expensive.
ESPN Classic comes in at the top of the list because it has such a small
weekly viewership, and yet costs about 21 cents each month. The most
expensive channels tend to be sports channels, which are both costly to
produce and consumed by a tiny sliver of the overall cable audience.
Of course, those same networks could bring in massive viewerships for
short periods during big events like the Super Bowl, and consumers may
be willing to pay just to watch when those events come up.
It is interesting to note that although other analyses have put the a la
carte price of ESPN at $35 per household, the channel is included in
Dish's Sling TV package, which costs $20 a month. An ESPN spokesperson
said the company doesn't comment on this type of analysis.
Additionally, while some a la carte channels may be able to draw
consumers at the unbundled prices, many of those channels are owned by
broadcast networks that have no interest in unbundling their cable
offerings.
"We believe that the broadcast network owners are not dumb and will
protect the economics of their hand," wrote researchers at
MoffettNathanson in a recent analysis of a la carte channels. "No one
should ever expect to see pure a la carte," firm co-founder Craig
Moffett said recently.
The networks would rather use their larger, more popular properties to
keep the smaller ones viable. That's the way television has always
worked, said Brad Adgate, senior vice president of research at Horizon
Media.
"It's been kind of a successful model for a long, long time, and I don't
really think that's going to change too much," said Adgate.
--
=================================================
George Antunes Voice (713) 743-3923
Associate Professor Fax (713) 743-3927
Political Science Mail: antunes at uh dot edu
University of Houston
Houston, TX 77204-3011
_______________________________________________
Medianews mailing list
[email protected]
http://etskywarn.net/mailman/listinfo/medianews_etskywarn.net
