Friday, May 23, 2008

Irrational cable pricing

Cable companies claim that if they offered a la carte pricing, each channel would get more expensive, because each channel depends on the fees that come from subscribers. But the per-channel fee should be calculable so that this doesn't matter. Just take the total fees currently paid by subscribers, and divide by the total number of channels times the total number of subscribers. That's how much each channel should get for each subscriber. If the claim is that people won't ask for more TV, but will watch it if they have it, make canceling channels an opt-out. If the claim is that TV sucks people in, well then the cable companies should be forced to make that argument.

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