If the government’s proposal to migrate the cable TV industry to a “pick and pay” model becomes law,
Yesterday, the government of Canada signalled its intention in a Speech from the Throne — a broad outline of government’s priorities for the coming session of Parliament — to make fundamental changes to regulations governing the sale of cable TV programming. Currently, most Canadian cable subscribers are required to buy “bundled” packages of TV channels that typically contain one or two channels they want and are willing to pay for, lumped in with a half-dozen or more channels they don’t want and would never pay for.
For the past decade or so, our TV universe has been expanding. What started as a farmer’s handful (all the farmers I ever knew were short a few fingers) of broadcast networks, exploded rapidly with the widespread introduction of cable TV. Networks became channels. And, channels became cheaper and easier to set up and run. As bandwidth increased, a plethora of tightly-targeted specialty channels emerged. Where once there was 6 o’clock news on major network stations, now there are a half dozen 24 hour all news channels in every conceivable language, all available at the click of a button on my TV.
Oddly enough, from a consumer’s perspective, the amount of content didn’t seem to grow as fast as the number of specialty channels carrying it. As a result, I have over 500 channels on my TV but, whenever I’m watching, they’re all showing reruns of CSI. NCIS, it appears, is more contagious than H1N1. It’s everywhere. Always.
But, while I exist in a 1,000 channel universe, I live a one channel life. At home, I watch one channel at a time. Often, not for long as I hunt for programs I’m interested in. I don’t read TV Guide and I don’t use the channel search function either. Because, I am a man. I was genetically engineered to hunt and gather. That’s how I watch TV.
And then, God created iTunes.
With high speed internet, came music and video streaming. While I worked in Central Asia, I discovered iTunes and bought (because I am from Generation Pay) entire seasons of programs I enjoyed. Once back in Canada, I realized I could buy all the programs I wanted for less than the price of my 1 million channel cable package. Except for news, which was only available live. Not anymore.
Now, the government wants to unbundle our cable packages. What would this mean for the industry and its consumers? I don’t know, but here are four guesses at what will eventually happen:
1. Most specialty channels will eventually disappear. Frankly, there probably aren’t that many people willing to pay to watch the Fireplace Channel or Fish TV. So, with much wailing and gnashing of teeth, they will probably eventually die. That’s sad news for people who own shares or work at these channels. But, consumers who like some of the programs these channels carry may find other ways to watch them.
2. Content will become King. The death of channels will be the liberation of good content producers. More people like me will purchase individual programs through brokers like Netflix and iTunes, or eventually directly from the producers themselves, displacing even the brokers. The TV ecosystem will rebalance, with online TV stores replacing channels as intermediaries of TV programming.
3. I will pay the same amount of money for TV. Maybe more. While our motivation, as consumers, in demanding this change is largely cost-driven, the reality is we are unlikely to see the new system reduce our costs. But, I will have fewer channels to hunt through on my search for a three year old re-run of Storage Wars: Kentucky. That must be worth something.
4. We will all hate the government. Having demanded the unbundling of cable TV services for years, consumers will absolutely hate the complexity of the new world. We will hate having to choose. We will end up buying more than we watch. Our bills will go up, not down. And, we will hold the government that delivered exactly what we demanded, responsible for doing so. That’s politics.