FCC’s Martin pushes a la carte at Cable Show

May 14, 2007

FCC chairman Kevin Martin once again pushed his controversial argument for cable a la carte, this time at last week’s Cable Show in Las Vegas.

“I don’t believe subscribers should have to buy Spike TV in order to get Discovery,” Martin told cable operators. “Fundamentally, I support consumers’ ability to pick and choose the products they want.”

Martin argued that a la carte would enable viewers to buy their television channels individually, in smaller bundles, or in the large bundles currently offered. “This issue has become even more important as the number of channels included in expanded basic, and the corresponding price to consumers, has continued to skyrocket. Expanded basic rates have almost doubled since 1996.”

In order not “to incite a riot here this afternoon,” Martin spared the operators detail, but argued that that a la carte approaches have worked well in other countries, such as in Hong Kong and Canada.

For example, Rogers Cable, a Canadian cable operator, offers consumers substantially greater choice and appears to be benefiting financially from this decision. Its net income for every quarter in 2006 appears to have outpaced its net income for those same quarters in 2005.

Kyle McSlarrow, chief of the National Cable & Telecommunications Association (NCTA), strongly opposes Martin’s proposal, arguing that less popular channels now survive as a result of program bundling. He also disputed notions that a la carte would in any way reduce TV violence.

However, in a recent interview reported by the Associated Press, McSlarrow said he would not be opposed to a la carte if such a model is driven by the marketplace and not mandated by the government. That could come, he said, if platforms like video-on-demand are successful with subscribers.

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