Bill Clark

I just read an article on CNN Money entitled Why Cable is Going to Cost You More, which points out that the average cable bill has and will continue to rise about 5% per year. Today, the average cable bill is roughly $75 per month. This means that in 5 years, we’ll be paying $95 per month for the same TV we’re getting now. They go on to say that much of the cost increase has to do with upgrading their networks to handle high definition and on-demand content, as well as increased broadcast TV carriage costs. To help combat these costs, cable companies might not just add a single line item to your cable bill, but rather increase costs of services across the board to make up the different. For example, they may charge more for video on demand, digital video recorder service, and other services they offer.

The article points out that times are changing and advertising dollars are dropping on broadcast TV, so the broadcast networks are demanding higher fees for cable companies to carry their channels. Another blow is dealt to cable companies in the loss of customers to web-based television.

It seems to me that the loss of customers points to a deeper issue. While it’s all well and good that cable companies are upgrading their fiber optic networks to help carry new higher-bandwidth content, it seems that none of these companies want to innovate and provide a service that web-based television and others can’t compete with. Sure, DVR was a welcome addition to my cable system, but that was nearly 5 years ago. What has Comcast done for me recently? My cable modem speed has gone up to 22Mbps from 15Mbps. That’s nice, can’t really complain there. But what about their television service? The cable boxes I’ve been provided in the past few years have all sucked. They lock up a few times a month, they’re slow to change channels, and the interactive guide feature just plan stinks. It hasn’t seen a facelift in years, and it’s terrible compared to Verizon’s offering on FiOS.

Let’s go back to broadcast TV fees and advertising for a minute. Now that broadcast TV networks are demanding fees for their programming, what does that spell for the future of television? If they have a guaranteed revenue stream from cable providers, they don’t have to worry about advertising quite as much, which may translate into lower quality programming. We’ve already got enough lower-budget reality TV as it is. Do we really need another season of The Bachelor or Survivor? Sure, it costs the networks less to produce than a “real” TV show, but with less of a need for advertising dollars, what incentive is there for broadcast networks to create programming that people will actually want to watch? Too many great shows have been canceled to make way for more reality TV because it costs less.

Another issue that I see is the “double-dipping” that the broadcast networks are getting away with. Their programming is freely available to anyone with a television and an antenna in their local broadcast area. If cable companies are providing the broadcast networks’ feeds via the cable network only to those in the local broadcast area, why is it acceptable for the broadcast companies to demand fees from cable carriers? I don’t think they should be able to have it both ways. If they want to charge for their content being provided outside of a local broadcast area, that’s fine, but if you can’t charge for it over the air, don’t charge my cable company to provide it to me. The cable companies don’t make any money off the advertising on the local broadcast channels, and they cannot preempt commercial breaks with their own advertisements.

I guess this is what it comes down to: If networks want more advertising dollars, they need to create programming that people will watch, not just the slop reality TV that half the country watches just because it’s there. And if cable companies want to stop losing customers to web-based television and other technologies, they need to start innovating beyond their current offerings. How about integrating a Slingbox-like feature into cable boxes that allows me to watch on-demand and DVR programming on my computer or iPhone anywhere in the world? Strike a deal with Slingbox. I know there are costs associated with all of this, but if prices are going to rise anyway, how about giving me something new for my money?