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FCC Opinion May Shake Cable Industry

The Federal Communications Commission is expected to issue a report indicating that, contrary to its earlier opinion, a la carte pricing in the cable industry could be in the best interest of cable customers. "By suggesting that consumers won't necessarily pay more for individual channels, the report calls into question the revenue model for cable companies," reports the Wall Street Journal. The cable industry has long relied on the tier approach to persuade customers to purchase packages of channels, although consumer groups have complained all along that the system was fundamentally unfair, forcing customers to buy channels that they did not want. Cable operators, in answer to those charges, have argued that pooling channels into packages actually lowers the cost of offering all the channels.



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