Cable Providers, Networks Squabble at Their Own Risk

An Ad Age Editorial

Published on .

While TV networks and cable operators pound their chests and rush at one another in their latest disputes over territory and money, they seem to be overlooking one little thing: the consumer.

Sure, the various players have aimed ads at the consumer. In the Time Warner battle against Fox, Time Warner told consumers that Fox was being greedy and mean. In the Cablevision squabble with Scripps (owner of HGTV and Food Network), Scripps assured consumers that the reason their networks had gone missing wasn't all that important, but it was on their side, really.

Of course, it's in the interest of both cable providers and TV networks to convince consumers that this is a horribly complicated affair and not really a matter of both parties holding programming hostage as they fight over pennies.

No, content isn't cheap to produce or, when it comes to TV, to distribute. And yes, networks and providers have some bargaining to do. Both sides have owners and employees and stockholders to answer to and it's the financial responsibility of both sides to seek a better deal.

But this strikes us all as incredibly shortsighted for both parties. There are only two possible outcomes: 1) an angry customer base as cable subscribers hold both parties responsible for temporary blackouts of their programming and 2) an angry customer base as the bargaining inevitably leads to higher cable bills.

The thing is, we're drawing ever closer to a day when customers don't have to take it. Even if the economy sees some improvement over the next couple of years, an increase in cable-subscription fees may be the final push viewers need to start canceling high-priced cable packages. They'll find some other way to get their content -- whether it be through satellite, internet or phone company.

And if they can't get that content some other way? Expect them to put more pressure on Congress to revisit the issue of a la carte pricing. There are a host of legal hurdles in the way at the moment, but we'd bet a Congress bitterly divided over partisan issues would jump at the chance to take up an issue that would likely find broad bipartisan support.

And that would completely change the cable TV revenue model -- in a way beneficial to neither party.

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