The remote control in the hand of an average American now has a selection of 189 TV channels available for viewing. That is an increase of almost 50% in the past six years.
So what do we do with all these new choices? We mostly ignore 172 channels and watch the same 17 channels we’ve been watching for the past six years. Apparently Americans don’t have much imagination.
The data come from a recent study by media research firm Nielsen, and their conclusion is not that Americans lack imagination. Nielsen says that Americans recognize (new) junk when they see it and are satisfied with the channels (junk?) they have watched for years:
This data is significant in that it substantiates the notion that more content does not necessarily equate to more channel consumption. And that means quality is imperative — for both content creators and advertisers. So the best way to reach consumers in a world with myriad options is to be the best option.
You don’t often hear the words “quality” and “pay TV” in the same breath. Far more common is the reaction of survey respondents who rate pay-TV services only ahead of Internet services as the worst industry in the United States when rated on customer satisfaction.
Consolidation in the pay-TV industry, with Comcast Corp. (NASDAQ: CMCSA) offering to swallow Time Warner Cable Inc. (NYSE: TWC) and AT&T Inc. (NYSE: T) wanting to gobble up DirecTV (NASDAQ: DTV), is not likely to improve either the quality of pay-TV offerings nor the price that consumers pay. Pressure will intensify from consumers and lawmakers to allow pay-TV customers to subscribe to just the 17 channels they want to watch and not the 172 and more they do not care about.
That is what is known as a la carte pricing, and it is not good for the cable companies that know they will have to charge higher prices for the a la carte subscriptions, threatening their subscriber numbers, their revenues and their profits. Some consumer groups are demanding a la carte pricing, figuring that the new pricing scheme will lower consumers’ monthly bills. That could happen, but it is not guaranteed. Picking the 17 channels that the average American watches could very likely turn out to be much more expensive than paying the tab for all 189.