Cable Sued Over Program Bundling
Multimillion-Dollar Class-Action Suit Filed vs. Major Cable Programmers, Operators
By John Eggerton -- Broadcasting & Cable, 9/20/2007 3:33:00 PM
Some cable subscribers are suing to get their programming a la carte, not to mention millions of dollars from the cable industry in damages.
A multimillion-dollar class-action suit has been filed against the major cable programmers and operators for violating antitrust laws by bundling programming in expanded basic tiers.
In a suit filed by veteran antitrust attorney Maxwell Blecher on behalf of 14 cable and satellite subscribers from a variety of cities, the plaintiffs asked the court to enjoin the companies from "unlawfully bundling expanded basic-cable channels and ordering defendant cable providers and direct-broadcast satellite providers to notify their subscribers that they each can purchase 'a la carte' (separately) except for 'basic cable.'"
That basic-cable caveat covers the lifeline basic package that includes the TV stations cable must carry per government mandate.
The subscribers said they have been injured because they have been "deprived of choice, have been required to purchase product they do not want and have paid inflated prices for cable-television programming."
The suit seeks treble damages, citing the alleged antitrust violations, explaining that "contracts between the programmer defendants and the cable and direct-broadcast satellite providers constitute a combination among and between the named defendants to monopolize trade and commerce in the relevant product market," in violation of the Sherman Act, they argued. It also alleged restraint of trade.
The cable industry has been under pressure by some in Congress -- Sen. John McCain (R-Ariz.) most notably -- and from Federal Communications Commission chairman Kevin Martin to offer a la carte programming as a way to lower cable prices and give parents more control over content.
The cable industry argued that government-mandated per-channel pricing will reduce programming diversity and could actually raise rates as channels forced to fend for themselves die off or have to charge more to make the numbers work.
The suit claimed to represent all cable and satellite subscribers except the defendents or their subsidiaries and employees.
Named in the suit were NBC Universal, Viacom, Disney, Fox, Time Warner, Comcast, Cox Communications, DirecTV, EchoStar Communications, Charter Communications and Cablevision Systems.
A National Cable & Telecommunications Association spokesman was not available for comment.
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Great idea. This way you only have to pay for the stations you WANT, not all the ones the cable companies make you support, at a higher rate. This way if you don't want, say the home shopping network, or a religious channel, or ESPN or TBS, or the Comedy channel, you don't have to pay for it, you can pick just the ones YOU want - kind of like a FREE MARKET, rather than a monoply. Those poor channels that can't pay their bills because people don't really want to watch them, but have been forced to pay for them, well those stations would face "the invisible hand of the market" whooo scary. Many other countries have this already, and it seems to work just fine.
L.E. Harrington - 9/23/2007 8:19:00 PM EDT -
Why not leave well enough alone. I believe that the cable companies are doing a great job.
If this money grabbing lawyer wants to do a service how about law suite to limit of cut down on the number of advertising. After all, we are paying for this feed. Come to think of it, I think that it's time that the viewer gets paid to watch some of the crap they send our way.
NFL games are the biggest problem, why don't they just move those games to pay TV and allow the viewer to watch the game of his choice.
dick rasile - 9/21/2007 3:02:00 PM EDT -
ok so what do those of us who live at or below the poverty line do? If you have money to toss around for digital / HD / DVR ect. then you get choices but what about us who live paycheck to paycheck? the rates will be raised and TV will be like owning a car or house these days only for the rich.
Rita Grant - 9/21/2007 12:36:00 PM EDT -
This is about time, I'm not a sports fan, BUT I have to pay ESPN $3.00 a
month for something I never watch. We have just cancelled cable service
and will instead buy what we do want from iTunes or watch it online.
Marc S. - 9/21/2007 11:28:00 AM EDT
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