Verizon CEO: Try a la Carte to Protect Cable

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Wait a second, Verizon's CEO actually said this? :eek:

“I think there’s a pressure now from customers about why do I have to have 300 channels?” He called a-la-carte “a novel way that could help protect subscriptions in the long run. … This isn’t a cause celebre for us but I think it’s an early warning that we should pay attention to.”
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I'm dubious of a-la-carte. It will all come down to said pricing of individual channels.
 
Now? Its been that way for ages. Whats different is customers now have a better choice (the internet) and are dropping cable.
 
I cancelled cable a few months ago and we don't even miss it. Hulu, amazon, Netflix, and antenna is plenty for us.
 
Data caps would get in the way if I watched all my shows thru the internet.
 
There is a lot of programming on cable that you disagree with but still subsidize with your subscription.
 
DoubleTap said:
There is a lot of programming on cable that you disagree with but still subsidize with your subscription.
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And I don't want it.

Let's say my cable bill is $100 for 200 channels, and I watch 5 channels. I'm not expecting to pay $2.50 for the 5 channels I watch. I'll gladly pay $80 if it means I get to pick which 5 channels I want though.

Realistically, I don't want 20 channels in Spanish, another 15 channels in various other languages, the 5 or 6 kids channels that I never watch, I don't need a channel that shows nascar. I don't care about any of the 20 sports channels. I don't want 10 news channels. I don't want a channel that shows old gameshows, I don't want a channel that shows old soap operas. I don't want 100 music channels that I never listen to. I don't want 5 versions of MTV and the other stuff like BET/CMT/VH1/etc.

Hell, one of my favorite tivo features is setting a favorites list of channels, then setting the guide to only show favorites so I never have to skip past the 500 channels that I never watch.

It's not a matter of disagreeing with the content, it's that I have absolutely zero interest in it.
 
Watch out. You guys will get the a la carte you want, but your bill will end up being $200/mo for the 18 channels you want versus $175 for the 300 channels, because each network will negotiate a price assuming it won't be part of a package deal, and the telcos will have to pay more for it.

You don't think what you pay for ESPN and ESPN2 covers just that, right? Some of that also covers SyFy, which the cable company might buy at a loss to provide to its customers. It also covers Univision and SpikeTV, and all the other less popular channels.

If you end up getting just the few most popular channels, I'm sure the telecom CEOs will find a way for it to cost you. They're not in business to lose money.
 
[Tripod]MajorPayne;1039793888 said:
If you end up getting just the few most popular channels, I'm sure the telecom CEOs will find a way for it to cost you. They're not in business to lose money.
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That's basically my thought. Almost no one wants 1000 channels, so if they go a la Carte, they'll just figure out on average how many channels people want, say it's 5, they'll then price it so 5 channels costs you as much as 1000 channels did and 10 channels cost even more.
 
This is a shot in the bow against ESPN and other sports channels. Sports channels are charging an arm and a leg for their programming these days, and this is presumably the pushback from cable companies against that.
 
Tudz said:
That's basically my thought. Almost no one wants 1000 channels, so if they go a la Carte, they'll just figure out on average how many channels people want, say it's 5, they'll then price it so 5 channels costs you as much as 1000 channels did and 10 channels cost even more.
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The question is will people tolerate that?

Sure, the offer can be made--but people could rebel (unpleasable customers ho). "I'm not paying the same for way less!"

People have to realize that individual channels do get subsidized by others, but at the same time if the cable companies try to gouge they'll just accelerate the move toward internet-based entertainment.
 
Sovereign said:
The question is will people tolerate that?

Sure, the offer can be made--but people could rebel (unpleasable customers ho). "I'm not paying the same for way less!"
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I'd assume they'd keep the old packages. Or raise the base price so that it costs a lot to get 5 channels, but then waive the base price if you jsut get a large package.

I don't think they'll make it worse for existing customers, they just won't make it so you can magically get what you want for significantly less than what they charge now.
 
Nope, won't help. There are two things wrong with cable: the cable companies and the price. If cable companies were actually competent and quit lying, that would be a start, but they also need to lower their pricing to about 1/10 of current levels.
 
[Tripod]MajorPayne;1039793888 said:
Watch out. You guys will get the a la carte you want, but your bill will end up being $200/mo for the 18 channels you want versus $175 for the 300 channels, because each network will negotiate a price assuming it won't be part of a package deal, and the telcos will have to pay more for it.

You don't think what you pay for ESPN and ESPN2 covers just that, right? Some of that also covers SyFy, which the cable company might buy at a loss to provide to its customers. It also covers Univision and SpikeTV, and all the other less popular channels.

If you end up getting just the few most popular channels, I'm sure the telecom CEOs will find a way for it to cost you. They're not in business to lose money.
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I fail to see this issue, isnt the reason there thinking this is because people are dropping cable for internet videos. If they charge that much for the 5 channles they do want, the same people they are trying to lure back or prevent from switching will do it anyways. There gonna need to make it a significantly good reason to pay for those couple channles versus just doing what they are/were planning to do, stream and download it anyways. It would be pointless to bring this in for people that were already content with what they had and were not going to drop them anyways.

I know when i phoned my satalite provider and told them I think my rates are rediculous for what I do watch, cancel my service and I'll just donwload and stream what i want with netflix and random websites. They immidiatly dropped my bill about 35% permanatly. They know charging to much loses money now, they need it back with attractive pricing.
 
I don't think he knows what "a-la-carte" means. At one point he says that cable plans need to be a-la-carte like VZ's wireless plans, but VZ's wireless plans are not a-la-carte. Data is subsidized into bundles, somewhat preposterously, based on the typical usage of whatever device you have.

I think his vision of cable plans would mean that if you have a large TV then sports and movie channels will cost more, and if you have a small TV then sitcom and cartoon channels will cost more.
 
I think the whole idea of "channels" is quickly becoming antiquated. I see a future of individual shows being sold a la carte, like music tracks. I'll look back and laugh (or just shake my head) at the days of flipping through 1000 channels and seeing all of the utterly irredeemable junk that I had to pay for in order to get the 5 or 6 shows I really wanted.
 
They will eventually be forced to change their ways and give the customer what they want. The music industry fought that for years, and look where they are now, selling singles on iTunes for the same price that I used to pay for 45's at Kmart back in 1982.
 
With the countless bullshit on TV nowadays.. Hulu, Netflix and local antenna for local news in HD are definitely worth waiting to catch up when its the right time. My life doesn't revolve around waiting for something to come on TV.

TV is less important than internet, as TV starts dropping internet bills will keep rising.
COX is slowly raising their cable bills silently, hoping people won't notice..

in 2010 I was paying 46.99 for cable internet through COcks
in 2011 I was paying 49.99 for cable internet COcks
in 2012 I was paying 53.99 for cable internet Cocks
in 2013 I am NOW paying 56.99 for cable internet COcks

SPEED HAVE NOT CHANGED. The bad thing is Cox is the only service provider in my area without giving up cable for DSL.
 
Interestingly enough this is something my family and I have discussed and, yes, we would theoretically go this rout. There are like 5 stations I have any interest in (SyFy, Comedy Central, Nickelodeon/TVLand, Discovery, and Animal Planet) My mother has a similar list of about 5 stations, and if they were offered for say $5/month/station we would pay for them. We've said this since the 90s - the cost are too high for so many channels we'd never watch...

My mother is still this way, and she'd still pay for it. I'd only get it if it was a free or nearly-free addon to my internet. I agree with SuperD up above, this is a style of broadcasting that comes from an analogue age and today in the 21-st century we have On Demand options that make Cable and such laughable. (for some reason though my mother hates on-demand and wants the old TV style programming... she *wants* to have to plan and schedule her life to watch a show she enjoys... Is the a generation gap or something?)

As I said, if I signed up for internet and they said "you also get X free cable channels!" then I'd take them, but I'd probably watch them a few times a year. I basically stopped watching live TV at the turn of the century.
 
I wish that cable had HD only tiers ... I haven't watch a standard definition channel since they added BBC America HD to my cable ... I think that a menu of theme groupings would work better than individual channel choice as well (buy the Science tier and you get Discovery, Science, History, Smithsonian, etc ... buy the Sports tier to get common sports networks) ... since I tend to watch channels in certain thematic groups that would work best for me :cool:
 
Sure, but can any cable provider explain to me why Netflix charges $8 a month and has zero commercials and yet to fail. Or why Hulu Plus costs $8 a month, has moderate commercials and has current shows and hasn't failed yet? What's the big secret here?
 
Netflix and Hulu are truly a la cart. I actually choose what I want to watch when I want to watch it. A cable " channel" gives you no control. What would make Netflix and Hulu awsome is if they had playlist channels that would just play random stuff of certain genres. For those times I'm indecisive.
 
What makes things worse is that those 100 channels start repeating the same content after a few years of running their own.
TLC, Discovery, Nat Geo, History and all their variants went from content that actually fit their name, to reality TV and repeats/crossovers from each other. One of those resulted in one of my older coworkers watching a fake documentary on Mermaids thinking it was real (he's got really bad eyesight and not too sharp in the head apparently). Then there's the weather channel, which now has reality shows on a large portion of the day.
And yes, I'm sure they did this to boost the ratings of these channels, but why? TWC *should* have very low viewer numbers, it's a "utility" channel! You switch to it, you watch it for 10minutes to get your weather report or look at the global forecast to see what storm is coming, then you don't watch it for a day/week. That's the point! But with some stupid storm chasers show on, I instead just jump on the web instead.
Don't get me started on "SyFy", there is some great content on there but damnit they are muddying their prime demographic by mixing in very NON-scifi content into their lineup. Do they still have wrestling on there? That was ridiculous to see, during somewhat primetime no less!
 
I'm not holding my breathe for ala carte cable. Even if they moved to that model I don't see it being any better. I'm seeing being charged just as much for less. Sure I'll get to pick what I want to pay for but as it stands now the less than 10 channels I actually watch, are pretty basic channels that I'm sure you'd find in any tier cable package right now. Also from time to time I catch something interesting on the other channels but I'm not gonna pay for those channels separately in the off chance they have something on at a random time of day on a random day.

Unless I'm paying a fraction of what I'm paying now for a fraction of the channels, I'll just stick to what I have or ditch it all together. I'm leaning toward the latter.
 
westrock2000 said:
Netflix and Hulu are truly a la cart. I actually choose what I want to watch when I want to watch it. A cable " channel" gives you no control. What would make Netflix and Hulu awsome is if they had playlist channels that would just play random stuff of certain genres. For those times I'm indecisive.
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That would indeed be awesome. That is one thing I like about cable. I treat shows and movies playing on cable differently than I do the same ones on Netflix or in my own personal library. If I'm bored, I'll browse Netflix for a while passing up movies I like but have seen and most times eventually just do something else. If its on TV I end up watching it.

I've contemplated ripping my whole library and working a little magic to randomly stream different movies to either all or some of my TV's to give me the same illusion. Started ripping a few blu rays which took forever and then my attention span ran out.
 
It's tempting to think that cable companies, which have no sense of value, will try to make a la carte pricing match whatever revenue stream they now enjoy. But then that doesn't solve their problem -- it accelerates it.

Broadcast can be had by antenna. Amazon, Apple, and Microsoft already let you buy new cable channel TV episodes a la carte. Netflix is already a reasonable substitute for a premium movie network (more so now that they have their own programming) at about half the price. Mispricing cable a la carte service will do nothing to stem a migration to alternatives -- and if the price/performance ratio drops, there's only additional incentive to find alternatives.

If cable companies try what many of you are suggesting, they're going to be left with a bunch of die-hard sports fans for customers. Possibly a few parents as well. But that's about it.
 
People think, I pay for 150 channels and I use at most 15. My cable bill will be 10%, 25% or 50% of what I'm paying now and it would be worth it.

In the short term, that might be true. After all is said and done. You'll be paying at least 100% of what you're paying now. If not paying a premium for the best content. It will be like Video Game pricing. Final season of Breaking Bad, $40. In 2 years, $20. And in 5 years $10. A la carte would turn into a gouging field day. Because they want X dollars out of you and you have no real alternatives in most places especially if they can crush Netflix, Hulu, etc. which they slowly are doing by draining them of content.
 
Cable companies know their service is old and obsolete. Their landline phone service, their TV service, all relics of the past. They're not going to simply die off though, they will just 'adjust' things and lean more towards internet services.

Instead of paying $150 for cable, phone, and internet everyone will simply be paying $150 for 'fast' internet service alone in the future. That's their plan. Their business model will slowly shift over and their oligopoly will continue.
 
I seriously doubt your major players will offer a la Carte channels at a reasonable price. It's nearly impossible to get a large public company to reduce their revenue in hopes of not losing a lot more long term.
 
I am with the a la Carte doubters...

Just like when VZ offered their new family data plan... my family is getting screwed because we don't have a massive need for data (have multiple grandma, normal lines which cost a lot with the new system).

Sure some people will realize savings but just enough to prevent massive exodus. Others will get screwed by a lot. Under the new VZ family data plan if I add data to one more phone (currently 1 of 4 has data) I will expect to pay 33% more. Where as the old $30 per line charge would be less, then this new plan... AND I would have less data per phone.

The same thing will happen here... the popular channels will cost way more and you will basically pay the same or more for the channels you do watch.

Another aspect to consider is content, at least with the current system there is room for more variation in programming. If a la carte is implemented it is very possible that only sports, reality TV and 5 drama shows will exists because there is less subsidization of less popular channels and content. While this seems very "communist" the barrier of entry is pretty high in this market. Though this could change a bit as it is easier to go direct to consumers with your content... it has helped music in the same fashion but I don't think it is at a point of mass adoption yet...
 
brogers said:
I seriously doubt your major players will offer a la Carte channels at a reasonable price. It's nearly impossible to get a large public company to reduce their revenue in hopes of not losing a lot more long term.
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Eventually they will have to do something different.

I think they face a pretty big problem.

People who cut the cord aren't coming back unless value is provided and they see it in the price. Even if you went a la carte, people aren't going to run back to them, unless they see the pricing as a value.

I look at it this way: I have 200 channels, of which I routinely watch 8, but like now, there is nothing on any of those channels I want to watch, and which is a frequent occurrence. So even if they went a la carte, what value is there if there is still nothing you want to watch on the channels? It will only be a short while of that before people get bored, and don't see the value any longer. Back to where they started.

Data caps maybe the new tiered pricing schemes, but they won't last forever either.
 
Data caps aren't going to solve anything either.

We may get stuck with a few years of it, but the major ISPs are already seeing the window close for using caps.

First is that content of all kinds keeps getting bigger. Uncompressed audio, streaming audio, streaming video, streaming video in HD, huge content downloads like buying a 20GB game on Steam. All of those have massive bandwidth needs and none of them are related to "illegal fire sharing." A combination of any two of them can blow a 200GB monthly data cap out of the water in nothing flat.

This is only getting worse as we transition to 4K TV broadcasts and movies. The industry is already dead set on providing 4K content as soon as possible to push us to get better TVs and buy new media boxes... how does the entertainment industry plan to reconcile their OWN push to ultra-HD content with the content providers desire to restrict it down to a trickle?

The answer in my opinion only is that the ISPs are not going to do this. They are already embroiled in upgrading their backbones and throughput technology on a constant basis.

I have still not heard any of them complaining that they will run out of transfer capacity. In fact, for all of their loud complaining about usage they seem to always be extremely careful to never imply they will be saturated. I suspect this is because they can stay ahead of demand and they know it. It's just a desperate grasp for a bigger piece of the profit pie that the networks hold.

It's a losing fight since the the business model of the old networks is failing anyway.

The sooner they start looking forward and figuring out how to provide the service people want instead of what they are leaving in droves... the sooner we are all happy and they make more money.
 
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