Is John McCain’s Cable à la Carte Bill Secretly Terrible?


Talk about hitting on a winning strategy five years too late. Forget the Alaska Governor Who Must Not Be Named — if John McCain was looking for a game-changer back in 2008, he should’ve floated the Television Consumer Freedom Act. The new legislation, which McCain introduced Thursday, aims to let cable customers select their lineups à la carte, getting only the channels they want, and eschewing the expensive ones they never watch. It would change the way the television business operates, and it could be a boon for the viewer. Maybe.

What’s at issue here, primarily, are “carriage fees,” which are paid by all subscribers for the channels in their cable package, whether they watch them or not. Take me, for example. You offer me the choice of a root canal and a full day watching sports, and I’m putting on my hat and heading to the dentist. (At least that’d be over more quickly.) But every month, $5 of my too-high cable bill is spent on ESPN, a channel I literally never watch. (I don’t even wanna know how much I’m spending on Fox News.) All told, out of the hundreds of channels on my box, I’m watching something under two dozen, averaging out to a per-channel cost that makes me want to burn a handful of 20s rather than send them to Time Warner — which would presumably prove more entertaining than your average college football game, but I digress.

There are other, seemingly consumer-friendly elements in the bill as well: media conglomerates like Viacom and Disney sell their channels to cable providers in “bundles,” so that, say, they have to take TeenNick in order to get Nickelodeon (and thus the consumer does, too). McCain’s bill would eliminate those bundles; it would also prevent established broadcast networks like Fox from migrating to cable-only operations, as that network has threatened to do in the face of the streaming signal company Aereo.

So it sounds like a winner, right? Eh, not so fast. As Time’s thorough analysis of the bill points out, nothing in it “explicitly obligates cable companies to make their à la carte pricing affordable. In the same way that they make cable and Internet bundles more financially appealing than buying the two services separately, operators might choose to make individual channels so pricey that consumers stick to bundles anyway.”

And here’s where it gets really sticky: “In the past, though, television networks have argued that bundling channels allows niche programming to exist when it would otherwise be economically unfeasible.” The Wrap puts a finer point on it: “The television renaissance taking place around us is viable in part because media companies are making so much money from a fractured landscape. The 3 million viewers who tune in each week to Mad Men’s meticulously crafted depiction of the 1960s may have to get used to more bargain-barrel production values when AMC’s parent company is forced to sell its channels individually. After all, the money the company earns from bundling WE TV and Sundance helps make Don Draper’s lifestyle possible.” So wait, that $5 I’m grousing about paying for ESPN helps make Bunheads (on fellow Disney channel ABC Family) possible? Well, that puts it in perspective.

McCain’s heart is in the right place here. But the cable industry, as it exists right now, is a dinosaur, and all this bill will do is pick over the bones. The high-dollar cable bill is about all that’s keeping the cable companies in business, and if even a force as mighty as HBO can’t shake off that business model and create a standalone presence online, it’s doubtful that it’s happening anytime soon. YouTube is taking steps towards an online per-channel subscription model, but that seems bound for the same kind of old-cable choke hold. And online media consumption has a set of problems all its own, as we’ve discussed.

But we’ll have plenty of time to dissect all of this at greater length when McCain’s bill comes to a vote, which will most certainly occur in today’s DC, where big-business interests and corporate lobbying and vast partisan divides would in no way choke a bill like this in its crib.