A la Carte TV Programming Gains Momentum

For many, there is no mystery about the fact that TV consumers want to buy only the channels they want -- a la carte programming. But how much would they be willing to pay?

A new study says 31% of U.S. consumers would pay $30 a month for exactly what they want, 17% would pay $75 a month, and 15% would pay $15 a month, and that 53% of U.S. consumers believe “this model would be cheaper than consumers elsewhere" -- in other countries around the world.

This research was commissioned by Irdeto, a media protection company, and conducted by YouGov, which publishes a number of syndicated reports, including a daily report on brand perceptions.

Richard Scott, senior vice president of sales and marketing of Irdeto, stated: “In addition to offering a compelling multiscreen experience, operators must also price themselves correctly to avoid losing consumers who realize that a la carte services can become quite expensive when added together.”

Digging further, 38% say they “like having lots of channels to choose from,” while 20% believe “channel bundles offer the best deal.”

This data seems to elicit what the traditional pay TV system -- big TV networks and pay TV providers -- have been promoting for some time: that a la carte programming package might be much more expensive than traditional big TV network bundles.

The results also reveal that 78% of U.S. consumers are willing to switch to a service that allows them to pay for only the channels or content they want, with 67% saying they pay for the majority of their TV content -- and that 47% of U.S. consumers would not invest in faster Internet to stream HD content in their home.

The survey is based on 1,179 U.S. adults, part of a global survey of over 5,285 adults, conducted from April 20 to April 27.

3 comments about "A la Carte TV Programming Gains Momentum".
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  1. Ed Papazian from Media Dynamics Inc, May 7, 2015 at 10:50 a.m.

    I wonder what the results would be if those who claim they would shell out $30 a month for the channels they want realized that this meant they would only be getting two channels----not the 190 they now receive. Say the man of the house opts for ESPN while his mate picks Lifetime. What does their little boy and/or girl get to watch?

    While it's only a guessing game, it is very likely that monthly subscription fees per channel in an a la carte world would be many times what the pro-rata cost appears to be in most subscribers' current "multi-channel "bundles".

  2. Martin Focazio from EPAM Systems, May 8, 2015 at 12:21 p.m.

    I can't belive we're still discussing "channels" at this point in time. It's akin to having a discussion about new options for fax machines.

    A la carte ending up "costing more than the bundles it replaces" is a FUD tactic, and it's not even a very good one.

    In an on-demand world, the largest unit of monetizeable video consumption is the season. A football season, a season of a prerecorded show.

    The next largest unit is the time-period, but without contracts. It's like the prepaid telecommunications market. You can start or stop service at any time. Increments are the month. The day pass. The weekend pass. The game pass. (recent Very Important Boxing match) 

    Finally, we get to what consumers mean when they say they only want to watch the "channels" they want - the meaning is they want the SHOWS - not the networks, with a few exceptions. Networks are incidental, just an icon on the screen, unless they work very, very hard to create, cultivate and manage a superior brand identity (like Disney). 

    The 2 channels vs. 190 channels and bundles vs. unbundled argument is orthagonal to the direction of the marketplace. It's perfectly obvious that we're heading toward a very large share of the market going to commercial-free sVOD/tVOD for most prerecorded content (Netflix/Apple/Amazon model)

    aVOD also will likely be the place for the low-end of the prerecorded market (e.g people who can't afford to pay for an ad-free experience). aVOD will also do fine in the truly live-as-it-happens (sports, maybe some news) linear market. All of the drooling over the miracle of "unskippable" stop soon after as some company starts reporting on the change in position of a device when an ad plays and charges accordingly. (When your unskippable ad started playing, the device was placed face-down so we didn't charge for it) Viewability challenges are a cakewalk compared to the world of empirical advertising (you only pay for ads that work) which is here, now, today and spreading fast out of "digital" and into "real" media. 

    Something like "bundles" will, of course, re-appear, but it will be more like the Amazon Prime model, where access to content is an add-on for being a part of some ecosystem (viz. Apple + HBO Now), not the sole product offered. 

    Finally, the assumption that when the "man of the house" (what is this, 1968?) picks ESPN and his "mate" (wtf?) picks Lifetime that the kids somehow dont' have anything to watch is a statement that borders on the surreal. I have 3 kids, one is 16, one is 11, one is 7. "TV" does not exist for any of them - or their friends. They and their friends have have their iThings and Phablets and they have Youtube and it's all I can do to get them to STOP watching stuff. They don't need or want "TV" at all. 

  3. Ed Papazian from Media Dynamics Inc, May 8, 2015 at 12:54 p.m.

    Martin, you really really got up on the wrong side of the bed this AM----another wtf? saying from 1968.  As far as your other comments are concerned, dream on is the only retort that I care to make as there's little point trying to carry on a debate with someone who has his mind made up and just wants to vent.

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