Question: What do rabid football fans, working moms and Clifford the Big Red Dog viewers have in common?
If you answered a deep appreciation for cheese dip, you would be only partly correct. The other bond between this disparate set of Americans is that they all are harmed by the way sports leagues and huge media conglomerates sell video programming.
Ask any sports fan if he or she would prefer to watch just the home team’s games, league or post-season championship, rather than buy the expensive pay-TV packages or sports programming tiers offered today, and you will get a loud yes. Ask any parent whether he or she would prefer only the family-friendly channels rather than a bundle that includes violence, sex, and language a six-year-old probably should not witness, and you will get an even louder yes.
So why are sports fans and parents left so unsatisfied by today’s video marketplace? Money.
Sports leagues and the five main content conglomerates filling most of today’s channel lineups historically have had no interest in offering slimmed-down programming packages tailored to consumers’ unique needs. This is because those organizations make more money if they can force down the throats of consumers ever-larger bundles of programming, charging a premium for the whole enchilada. You want your favorite games or shows? Then you have to buy a lot of other stuff you don’t want. That has been the bargain for years.
Dodgers fans watched this play out when team owners and MLB allowed one company (Time Warner Cable) to acquire all home games, then insist that distributors had to buy the whole package at a sky-high rate, rather than allow fans to watch only the games they want. The result was that 70 percent of local Dodgers fans could not see the games, until Charter announced that it will carry the games to about 300,000 Los Angeles homes. Similarly, Disney produces some of the most sought-after programming by both fans and parents, with its flagship ESPN sports networks and its iconic, Disney-branded children’s programming. Left to her own devices, a fan might pay a premium just to get a sports channel or, better yet, just to watch her favorite team’s games; a single Dad might pay a premium just to get the Disney Channel so his grade-school daughter will not accidentally turn on “Secrets and Lies.” Disney, however, will not allow any distributor to slice and dice its programming lineup to match consumers’ wishes. Therefore, the sports fan’s and parent’s only option has been to buy it all or get none of it.
The Internet has disrupted the music, publishing and long-distance phone markets and now appears to be doing the same to video. Consumers can pick and choose only the shows they want to watch, where and when they want to watch them. Online streaming services like SlingTV or Apple’s forthcoming service offer slimmed-down programming packages, with fewer channels and at a lower price than the typical cable or satellite offering. Netflix and Amazon create and distribute directly to consumers original dramas, bypassing the big pay-TV programming bundle altogether. The NFL recently announced a first-ever Internet-only game.
This presents an opportunity to every sports fan and concerned parent who ever bemoaned the bundle. The NFL, NBA, MLB, NHL and NCAA conferences can and should follow consumer tastes and break the bundle, allowing the purchase of only the games fans want to see. Programming conglomerates like Disney should allow parents to purchase children’s programming on a stand-alone basis.
The large content providers have argued in the past that this kind of “a-la-carte” approach will drive up costs to cable and satellite subscribers. They say that the bundled approach spreads costs across more channels, allows smaller services to survive, and that without this practice, individual shows or channels would be prohibitively expensive and not result in overall savings to the consumer.
That argument assumes that fat profit margins are some kind of God-given right. They’re not. More importantly, the argument has been overcome by technology and taste. The World Wide Web is the ultimate a-la-carte service. So is on-demand programming delivered “over the top” via broadband to a tablet or Internet-enabled TV. Consumers have voted with their clicks and cash. If content creators do not change with the times, they will go the way of Tyrannosaurus Rex (no offense, Barney).
We believe that sports fans, parents and children all would benefit from a more flexible, consumer-driven, unbundled video ecosystem that allows each of us to pay for what we want, rather than pay a ransom to watch what we don’t. Sports leagues and media conglomerates have a chance to do the right thing for fans and parents, no doubt helping to secure their own financial futures in the process.
• Tim Winter is president of Parents’ Television Council and a former NBC and MGM executive. David Goodfriend is chairman of Sports Fans Coalition and a former DISH Network executive.