I agree, as usual, with my colleague Bret Swanson that regulating cable pricing is an awful idea and that the debate over Ã la carte is moot in any event.
Chairman Kevin Martin isn't proposing to require Ã la carte programming, but he is impatient with the cable industry for not doing enough, as he put it, to give parents more tools to navigate coarse programming. Re-regulating cable would be a disaster. Just remember back to 1992 when Congress and the FCC tried to regulate cable rates and almost bankrupted the industry. There are many smart people at the FCC, but the effort to protect consumers from cable rate hikes proved to be too complicated and Congress had to repeal the whole thing.
As a parent of two young children I have dealt with this problem by not subscribing to cable at all, but I realize that I am in the minority. For everyone else, there already are tools to block unwanted content. Right now, analog set top boxes allow parents to block designated channels. Digital set top boxes allow parents to choose between blocking unwanted channels or simply blocking particular programs or preventing any viewing at all during certain hours. And, most newer televisions contain a V-Chip inside which allows parents to block programs based on their ratings categories (unfortunately, the program ratings don't apply to advertising). Most consumers have or will acquire digital set top boxes and/or new TVs in order to be able to receive the digital broadcasts that Congress has mandated for the purpose of increasing federal revenues. The bottom line is that technology is solving this problem -- unless we eliminate the need for it with reckless regulation.
Chairman Martin also mentioned that he has asked the cable industry to voluntarily offer a family friendly programming package and not require subscribers to pay for programming they consider unsuitable. Everyone agrees that a family-friendly tier sounds like a good idea, but the cable industry is apparently not convinced that a market exists. Adam Thierer notes that a few years ago, DirecTV offered a "Family Choice" tier with about ten channels for just $5 dollars per month, but dropped it due to insufficient consumer demand.
Matt Polka, testifying on behalf of the American Cable Association, suggested a variation when he noted that some of the group's 1,100 members would like to move channels with indecent programming to a separate tier. "The problem is: They can't," according to Polka, "The wholesale practices of the media conglomerates prevent it." He said that indecent programming and channels are "tied" to broadcast channels through retransmission consent or to "must have" cable channels. In antitrust law, to "tie" means to offer to sell one product only on the condition that the buyer agrees to purchase a different product. It has nothing to do with discounts for bundled products. If tying arrangements are occurring, these companies should talk to their lawyers.
Like Bret, I don't think that the current cable tiers will ultimately be able to compete with the cornucopia of content that will be available on the Internet. I also think that the technological solutions offer more promise than is generally assumed. The technological solutions are frequently derided as too complicated for many adults to manipulate. If that's the issue, the industry is in the best position to work it out. Maybe the issue is that we don't like what other parents' children are watching. Draconian measures would be needed to solve that problem.