12.14.2011

The Negative Impact of Cable Bundling

An interesting post on Andrew Sullivan's blog about why cable television can't be a la carte made me think of the impact cable bundling has outside of the legalities and economics of cable television.


Cable bundling has enabled the corruption and radicalization of cable TV news. It the basis of Fox News' business model.

Here's how it works. Fox charges cable companies about 70 cents a subscriber. That fee provides about half their profits. So everyone who has Fox News on his or her cable system is compelled to pay Fox 70 cents a month. No matter how much I loathe Fox and what it has done to our political discourse, I have to pay them 70 cents a month. What this means is that Fox pays no economic price for stoking extremism. The opposite is true. It can cater to a mere three or four million Americans, 1 percent of the population, a ratings bonanza in the chopped up world of cable TV, while collecting a fee from tens of millions who detest the network. It boils down to this: I cannot stop paying Fox News no matter how much I hate it. I'm captive.

If Fox became a la carte, the results would be dramatic and immediate.

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