It's not hard to envision a future where your TV programming comes from just the content providers you select, whenever you want, on whatever platform you like. You won't be the captive audience to the cable providers and the channels they bundle for you, or to their schedule, or to your living-room set. It's not hard because we're already part way there. Still, given the numerous technological and business hurdles that seem to lie ahead, it's hard to see how we're going to get from here to there.
Still, recent statements by two of the most powerful CEOs in TV hint at a bridge toward that future -- even if their tentative moves forward lead to the destruction of the cable business as we currently know it.
Consumers and congressmen alike have pushed for years for à la carte cable instead of the bundled channels that cable and satellite providers force us to buy. We may pay only pennies a month for most channels, but we still have to buy them in packets instead of getting only the channels we want.
The recent development of online on-demand adjuncts like HBO Go and Showtime Anywhere makes the issue even more glaring. These web services allow you to watch even more content than cable HBO or Showtime do -- entire libraries' worth of series, each with their full archive of episodes, as well as the channel's current movie offerings. You can stream the programming whenever you choose and on any Internet-enabled device, stationary or mobile. But to subscribe to these services, you still have to buy an entire cable TV package.
That may change soon, however, for U.S. viewers. Already, you can buy HBO Go as a stand-alone service if you live in certain Scandinavian countries. But Americans may soon get a crack at it as well, sort of. According to Deadline, Jeff Bewkes, CEO of Time Warner (HBO's parent company), told an investor conference on Wednesday said the cable channel is experimenting with a package deal with cable provider Comcast that would offer subscribers HBO Go, plus the broadcast networks and broadband Internet service, for around $50 per month. And CBS chief Les Moonves, who oversees Showtime, said his company is thinking of a similar offering.
Granted, TV over the Internet is still a far cry from picking and choosing which cable channels to subscribe to. And you still have to buy other TV and Internet services with the proposed HBO/Comcast deal. Still... baby steps.
As Bewkes noted, there's no real legal or technological obstacle that prevents the content providers from moving toward an à la carte future. "We have the rights. We can do it if we want to now," Deadline quotes Bewkes as saying. "But we don't want to do anything that's not at a high level." That's corporate-speak for: We want to try it out in some test markets, other than Finland, and get data on whether we can still make money on it, before we roll it out nationwide and confront the cable and satellite service providers.
No doubt the cable companies will balk at anything that smacks of à la carte service. But they may not have much of a choice. For one thing, in the power battle between service providers and content providers over the past few years, the content providers have tended to come out on top. The battleground has been carriage fees (the monthly fee each channel demands from cable providers for the right to carry it and bundle it in a package for subscribers). Lately, many channels have demanded increased carriage fees, cable companies have said no, the channels have gone dark for a while, and the cable companies have relented and paid higher fees, passing the added expense on to their customers in the form of a higher monthly cable bill. The cable companies may not have the stomach for an additional fight, and they may prefer to allow some direct-to-consumer offerings (especially if, like the HBO/Comcast deal, the cable companies get to share in the profit), rather than lose channels outright.
For another thing, the content providers are seeing the rise of on-demand streaming services like Netflix, Hulu, and Amazon Prime. They're making shows -- including some of HBO's own programming - available to viewers without making them buy a cable subscription. It's no wonder they're feeling some pressure to compete on that playing field. Of course, $50 a month may seem too high a price point, even with the extra services, for customers used to paying $9 a month for Netflix. Again, baby steps.
The channels aren't ready to ditch the cable and satellite companies completely just yet. They still rely on them for marketing and subscriptions. It could be that these feints toward an à la carte future are less a way of transitioning toward a business model that embraces the inevitable than a way of squeezing the last desperate drops of blood from the current model. Still, this kind of thaw suggests that a pick-your-own-channels future is inevitable. As for whether we'll all save money in the long run by ordering just the channels we want, on the delivery system we want -- that's another story.
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