Simply put this highway robbery works as follows. We all end up with some dozen or more sports channels, and we pay several dollars for each channel whether we watch it or not. Now I have never seen a football game, and frankly I have no interest in watching some group of morbidly obese males dressed in bright and tight fitting costumes, wander around some large field patting each other on the butt. I assume that there must be some logic there somewhere but I fail to grasp it. I have seen one basketball game, I had to since it was a client, and my wife is an avid Red Sox fan so well you see where that goes. But I pay most likely almost 50% of my cable bill for channels I never watch and never will.
So let us assume that we have 120 million cable HH, a good number, and we pay at least $250 per HH per year. That is $$20 billion to the cable companies, then to the teams and then to the players. Do players generate jobs, no, do they add to out net wealth, no, do they do anything beneficial? No. So why are we forced to do this? The FCC is one example. It could stop this in a heart beat by mandating individual cable line ups. Namely you and I get to choose, and then pay, for what we want. Simple, yes? Yes? But has any FCC Chairman had the courage to implement this? No way, too much money going to Congress etc.
The Times states:
Per-subscriber fees for sports networks keep going up: ESPN, the
granddaddy of them all, passed the $5-a-month mark last year.
The eye-popping price tags have restarted debate about a topic near and
dear to sports fans, fairness: many TV customers never watch the
mightily expensive channels at all, yet almost all must pay. There was a
shudder in the industry when John Malone, the business tycoon who
helped create the modern-day cable system, said in November that
“runaway sports rights” costs amounted to “a high tax on a lot of
households that don’t have a lot of interest in sports.” The only
short-term fix, he said, was government intervention.
The price increases reflect the leverage big sports leagues have as
distributors like Time Warner Cable and programmers like ESPN
desperately try to hang onto live programming in the age of the digital
video recorder and the Internet.
Now they continue to reinforce my prior complaints:
“The cable industry has done everything it can to bundle programming and
force consumers to buy things they don’t want,” said Gene Kimmelman, a
former Justice Department antitrust lawyer. “Finally, one piece of their
bundle has become so expensive that it may finally force the cable
industry to shift gears and split the bundle out of fear of pricing its
own customers out of the market.”
But this is also an antitrust issue. It is called a tying agreement. It is illegal to force me to buy something else that a seller has just to get some other product. You cannot legally tie these two items together. So where is the Antitrust Division of Justice, it appears to have been asleep for at least 30+ years! There has not been a real antitrust action since AT&T and IBM in the 70s! And from this Administration one would expect some respect for "fairness". Don't hold your breath. Cable companies are merely facilitators of this near extortion. You want cable, especially since you really can't get off the air anymore, then you must buy this junk at the high price whether you ever watch it or not.
Now in the same article we have the arrogance of one who is quoted as:
Chris Bevilacqua, an investor and consultant who has spearheaded the
creation of several college networks, said, “If consumers were that
upset by the costs, they’d be dropping their cable subscriptions in
droves.”
So what alternative is there? None, If you want say PBS, go pound sand! CNN same answer. Try real time downloading and the Cable guys slam you on usage. The FCC and/or Justice could have done something, anything. But alas these do gooders for the common man have done nothing for decades. The prices keep increasing and there is no end in sight. We have reassembled the duopoly of wireless and wireline and we have an effective monopoly of cable. We all agree that if there is no competition we need a regulator. So where is the regulator, asleep at the switch, as usual!
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