FCC to Congress: “À la Carte” Can Get Pricey

After five months of study, FCC says that forcing cable systems to sell channels “à la carte,” or one by one, would lead to higher bills for most cable customers.

The average household, in fact, would see monthly bills rise 14% to 30%, the FCC found in its study. Prompted by critics of the cable industry, Congress in May asked the FCC to study whether requiring à la carte would end years of exorbitant price hikes and could allow parents to shield kids from racy channels. Consumer advocates argue that subscribers could cut their bills by rejecting channels they don't want, especially expensive ones such as ESPN.

But the FCC found that programming networks would increase marketing expenses to persuade subscribers to take their channels and the cost would be passed on to consumers. A small group of subscribers could cut their bills, the FCC acknowledged. Those who purchase fewer than nine channels could offset the per-channel increase in prices enough to cut their total bills.

The cable industry breathed a collective sigh of relief at the FCC's thumbs-down on à la carte, which it had vociferously opposed.

“Mandatory per-channel pricing would put significant and harmful economic pressure on program networks,” says Robert Sachs, president of the National Cable & Telecommunications Association.

Broadcasters to FCC: What Smut?

Broadcast TV's top programmers defended their taste in shows and called on the FCC to clarify what qualifies as indecent. “The last time I checked, we're in the entertainment business, not politics,” ABC Entertainment President Steve McPherson said Friday at an International Radio & Television Society breakfast in New York.

ABC has felt the most heat in recent days after a racy Monday Night Football promo with Desperate Housewives and after dozens of ABC affiliates preempted a Veterans Day airing of Saving Private Ryan over language. McPherson said he is “amazingly proud” of Saving Private Ryan, adding that the affiliates had to make their own decisions.

“The FCC has to provide guidelines that make sense,” says Fox Entertainment President Gail Berman. “No one is clear about what their guidelines are, and you can't live in an environment where there is so much fear.”