A La Carte Cable Television
Issue
Some interest groups have proposed a congressional mandate on cable companies,
requiring they offer "á la carte" cable television options, in which a
consumer would pay only for the individual channels he or she wants to receive.
AAF Position
The AAF is concerned about proposed laws requiring companies to offer an
á la carte cable television option; however, private companies are free to
experiment with the model. We are concerned that the idea will prove to be harmful
to advertisers, media companies and consumers. Niche networks will have a harder
time remaining profitable, and new ideas in programming might never take off.
Therefore, consumers are likely to have fewer options and programming diversity
will suffer.
Opposition
Supporters of these pricing models point to studies purporting that á
la carte cable channels might save consumers up to 13 percent on their cable
bill. Other studies have found a la carte would lead to higher prices and fewer
choices, thus less programming and diversity. Some have called for an a la carte
option as a means of reducing the availability of programming inappropriate to
children.
Status
In early 2007, the Federal Communications Commission issued a report to
Congress saying that companies should be required to offer a la carte cable lineup
options to allow consumers to pick and choose cable networks at their discretion,
not because it might save consumers money, but because it would allow subscribers
to block unwanted content.
The Federal Communications Commission reversed its position on a la carte cable television. In a 2006 report, prepared under Commissioner Kevin Martin, the FCC concluded that an á la carte option will save consumers money. In 2004, when the FCC was led by Michael Powell, Congress initially directed the FCC to study a la carte pricing. The original study concluded that consumers would save money only if they subscribed to less than nine cable channels.
In 2006, Sen. John McCain, R-Ariz., said he plans to introduce legislation that would "entice all providers of television services to offer an a la carte option in addition to a package of channels in return for regulatory relief."
Updates
April 17, 2008: Federal Communications Commission Chairman Kevin Martin has renewed a push to implement á la carte cable television lineup options. Martin has indicated a desire to invoke an existing clause in telecommunications law that would allow the FCC new oversight of cable systems in order to ensure an á la carte option.
Last updated: September 2008