WASHINGTON -- In the dream world of some television viewers, they would pay their cable or satellite companies only for the channels they want. Some might not pay for MTV, because they don't want their 8-year-olds watching it. Others would turn down ESPN Classic, because they've already seen the 1975 World Series. Others would eschew TeleFutura, because they don't speak Spanish.
Reality is far different.
No U.S. cable or satellite company offers what are called "a la carte" plans. In order to get the Discovery Channel from Comcast Corp. cable company, for instance, viewers have to pay for an "expanded basic" package that includes MTV, FX, MSNBC and other channels.
That may change, if some lawmakers and consumer groups get their way, as the cable industry finds itself under increasing scrutiny. Lawmakers report that their constituents are angry about cable bills that have risen at three times the rate of inflation since the industry was largely deregulated in 1996. Others want government to do something about the rising incidence of profanity and nudity found on pay-television systems.
One possible solution being proposed is a la carte cable, a way to give consumers more choice over what they watch and how much they pay for it. But it's not an answer the cable industry will swallow easily, if a Senate Commerce Committee hearing Thursday on cable rates is any indication.
Committee Chairman John McCain, R-Ariz., peppered Cox Communications Inc. President James Robbins, asking the head of the nation's fourth-largest cable company why consumers have to pay for channels they don't want. Robbins' answer: Giving consumers that degree of choice would cost too much.
Expensive set-top boxes would be needed to give consumers the pick-and-choose capability, and the upgrade could cost the industry billions of dollars. Companies would inevitably be forced to pass on some or all of the expense to subscribers.
"Frankly, that is where long-term the industry is going to go -- to video-on-demand," said Robbins, whose system has 6.3 million subscribers. "But there's a $30 (billion) to $40 billion bridge to get there."
Besides adding to the cost, cable companies say, selling channels individually might make it difficult for lesser-watched, niche channels to survive.
Under an a la carte system, top-rated cable channels such as USA Network would likely thrive because ratings suggest enough people would choose to buy it individually to make it worth a programmer's while. However, less-watched channels that serve distinct but smaller audiences, such as TechTV and BET, may not survive, because not enough viewers would pay for them. Under the current system, consumers effectively subsidize less-popular channels, which cable companies say provides diversity in the cable and satellite universe.
However, some consumer advocates and members of Congress don't buy that logic.
"When I go to the grocery store to buy a quart of milk, I don't have to buy a package of celery and a bunch of broccoli," McCain said in an interview. "I don't like broccoli." He argues that it's not an either-or situation for cable companies: They could continue to offer packages for consumers who wanted them and a la carte for other viewers.
In the interview, McCain said he probably would propose an amendment this year -- it could be attached to an authorization or spending bill, he said -- requiring cable companies to offer a la carte programming.
McCain is working with Consumers Union, the nonprofit organization that publishes Consumer Reports, to draft an amendment designed to make a la carte available. Gene Kimmelman, director of public policy for Consumers Union, presented senators with summaries of Canadian digital cable plans that allow customers to buy channels a la carte.
For some lawmakers, a la carte programming is a no-brainer.
"Letters have been streaming into my office," said Sen. Frank Lautenberg, D-N.J., a member of the committee. "I don't hear as much about highlighted issues, like gay marriage ... as I do about rising cable rates."
"The logical next step," Lautenberg said, "is to relieve consumers of the burden of paying for channels they don't watch."
Don't want it⢠Too bad
To get the most popular cable channels, consumers must also pay cable and satellite companies for channels that fewer people watch. A look at last week's top-rated cable channels and their lower-ranked cousins owned by the same company:
Channel : Nickelodeon
Ranking : 1
Owner : Viacom
Corporate cousins: Nick Toons, CMT, BET, Nick at Nite, Noggin, MTV2.
Channel : TNT
Ranking : 2
Owner : Time Warner
Corporate cousins: Turner Classic Movies, CNNfn, Headline News.
Channel : Cartoon Network
Ranking : 3
Owner : Time Warner
Corporate cousins: Turner Classic Movies, CNNfn, Headline News.
Channel : Disney Channel
Ranking : 4
Owner : Disney
Corporate cousins: ABC Family.., ESPN.., Soapnet.
Channel : Lifetime
Ranking : 5
Owner : Disney/Hearst
Corporate cousins: History.., Biography.
Source: Neilsen Media Research, week ending March 21.
