Short Nerd Chief

Chris Albrecht at NewTeeVee asks whether a la carte pricing for cable is a sucker’s bet:

“A la carte” pricing for cable has been a hotly-debated topic since… well, since people first looked at their cable bill and cursed their provider. Yankee says the average cable subscriber pays $60 a month for basic cable, and Nielsen Media Research said that the average cable subscriber pays for 85 channels and only watches 16.

The implied question here is why pay for 69 channels you don’t watch (or, conversely, why pay $3.75 per channel you do watch).  Phrased that way, it sure sounds better to pay $22.67 for the 16 channels you like and tell the cable company to pound sand.  It is, however, precisely the wrong question (which Chris probably realizes).  What we need to know is the net cost to run the network (overhead-non subscriber revenue) and the number of people willing to pay for it.  Add some margin to A and divide by B, and you have a nice a la carte price.

Unique viewer numbers are virtually impossible to obtain.  Suffice it to say, a highly rated cable program would be an abject failure on network TV.  Beloved darling BSG averaged 1.8 million viewers last season, according to this week’s Entertainment Weekly. Recently-canceled Internet cause célèbre Jericho drew about 6 million for its March 25 episode.  And no, that doesn’t mean there are 1.8 million people who would pay a la carte for SciFi Channel (the actual number is n-x, where n is the total number of unique viewers and x the number of cheapos who won’t pay for it - I have no idea what n or x is).  Dividing net cost by (n-x) is certainly more than $1.25.

So what would you pay for a la carte cable?  Almost certainly more than you pay for a bundled package, wherein you subsidize me watching Katie Sackhoff on Friday nights (or whenever I get around to watching the recorded show on the DVR), and I subsidize you watching The Hills.

NewTeeVee thinks (duh) that the answer is New TV:

Of course, proping [sic] up cable companies and their dying business models isn’t a good reason to keep a la carte around. But go ahead, keep fighting; we’ll be over here watching Hulu.

Now I like Hulu as much as the next guy, but how much did NBC-U get for the “limited commercial interruptions” in the 2-part BSG Season 3 finale?  Certainly not enough to pay for the production costs, even if all 1.8 million descended on Hulu and crashed the stream.  Hulu is also a poor substitute, given the paucity of its library and the limited number of episodes for shows that are there.

Eventually, cable may go the way of the buggy whip, but not yet.  Internet-only video is still somewhere between Adequate and Sucks Ass.  Internet distribution of Old TV is still hamstrung by content providers and bandwidth.  So we suck it up, pay The Man, and complain about our miserable fate.