FCC

FCC
FCC
Cable and Congress are at it again. During a hearing that was supposed to be about indecency, Federal Communications Commission Chairman Kevin Martin brought up a study which “concludes that purchasing cable programming in a more a la carte manner in fact could be economically feasible and in consumers’ best interest.”

The idea of a la carte programming found some support from at least one cable operator. “We do not believe in the long term that selling programming a la carte will be detrimental to either programmers or cable operators,” said Cablevision’s chairman, Charles Dolan. But most of the branded network operators held a slightly different point of view. “We’d be out of business,” said Geraldine Laybourne, CEO of Oxygen (a cable network that targets female viewers). If the cable industry went a la carte, she said, growing networks like her own would struggle and new networks would never get off the ground.

There are all kinds of business arguments for and against this kind of programming, and we won’t go into them here. However, from a naïve, consumer point of view, the argument that a la carte cable channel offerings are a good idea is backed up by Nielsen Media Research. They say that, even with 500 channels available, the average TV household is found watching an average of only 15 channels.

There’s only one problem with this finding. People don’t watch channels, they watch shows. It’s true that branded networks, like ESPN, MTV, FoodTV or The Golf Channel, offer reasonable expectations that you will see a specific genre of programming, but you don’t go home to watch a channel; you go home to watch a show. “Pimp My Ride” is the brand, not MTV; “Queer Eye” is the brand, not Bravo; “WWE” is the brand, not whatever channel it’s on, etc. Shows are the basic units of programming, and they are just starting to be sold a la carte.

Consumers are going to find a way to watch the shows they want to watch, and to discover new ones–and they will be offered technology from several different sources to accomplish this. With the advent of VOD (Video on Demand), DVR (Digital Video Recorders), IP Video (Internet Protocol or Streaming Video), IPTV (Internet Protocol Television), Mesh Networks (Peer-to-Peer), WiMax and other two-way wireless systems—and, ultimately, DTT (Digital Terrestrial Television), consumers are going to have an overwhelming number of ways to acquire or otherwise aggregate their media experiences. If cable doesn’t want or can’t sell you ESPN a la carte, you will get their shows on iTunes or via Clipcasts on your mobile devices – in time, ESPN will find a way to sell you all of their shows: anytime, anywhere and on any device. Every content owner has made the same commitment.

Whether selling a la carte cable channels is a good idea or a bad one is not the issue. How you feel about it is directly related to which side of the river you happen to be standing on, and the age of your technological infrastructure. However, if you think just a little bit into the future, you have to wonder why these hearings are being held at all. Over the next few years, cable channels and the networks that occupy them are going have to evolve their distribution models into branded, random-access playlists suitable for consumption on a wide range of consumer electronic devices. The components of those playlists will be individual shows which, by definition, will be have to be sold a la carte. Shelly Palmer

About Shelly Palmer

Named one of LinkedIn’s Top 10 Voices in Technology, Shelly Palmer is CEO of The Palmer Group, a strategic advisory, technology solutions and business development practice focused at the nexus of media and marketing with a special emphasis on machine learning and data-driven decision-making. He is Fox 5 New York's on-air tech and digital media expert, writes a weekly column for AdAge, and is a regular commentator on CNBC and CNN. Follow @shellypalmer or visit shellypalmer.com or subscribe to our daily email http://ow.ly/WsHcb

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"The Pwss Principle – People Watch Shows, Stupid!" by @ShellyPalmer

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