John McCain wants to lower your cable bill

Some politicians don't know how much "We the people" pay for a gallon of milk or bread.  Remember that?  Enter John McCain, who thinks the folks pay too much for cable TV.  Or, at least the number of channels one must buy in a bundle should be offered a-la-cart instead.  This sounds fantastic right? 

But will this effectively lower the price of pay tv?  Common sense says yes. If I only pay for what I watch my bill will go down right?  For example, if I only watch 8 cable TV stations and each is $4 my $80 cable bill should be reduced $48 right?  Uh, not so fast.  

How much do you pay for set-top box rentals and will the channels really be $4 each? The cable bundle you purchase now has like 100+ channels right?  If you strip out the crap, your left with what maybe 20 good channels?  That's debatable but let's say yes.  Ok, so  we get 20 good channels for $80 per month.  Let's also say you pay $20 in set-top box rentals.  So that's $60 you pay for those 20 good channels which works out to $4 per channel.  Are you with me still? 

So, we're at $4 for the channels you actually watch.  Now, let's say you purchase 8 channels of the 20 good channels that you must currently take from a bundle.  8 channels by the way is pretty typical of what the average pay-tv viewer actually watches on a regular basis.  So, let's also assume you only pay for what you watch which is 8 channels at $4 each or $32 in content and set-tops remain at $20.  Ah-ha, our cable bill just went from $80 to $52.  Thank you Senator McCain, you just saved me $28 per month!  Uh, not so fast.

 Now, all of this assumes that Dish, DirecTV, Comcast, Charter, Time Warner, etc etc will all charge $4 per channel which is how "we the people" value these channels right?  But here's the problem.  The channels we actually watch and are willing to pay for are what the cable companies will say cost more like $8 per channel.  You see this potential legislation will only force the cable guys into admitting the 100 channel package you must buy is filled with 80 channels worth of crap.  They'll sell these channels cheap maybe even $1 each.  But what do you think they'll charge for ESPN, Fox, History Channel, TNT, USA, Food Network, AMC, and Disney?  Yea, I think more like $8 each maybe even more.  So now, we're back up to $80/mo again for cable with fewer channels.

It's kind of like going to the movie theater and buying snacks.  Sure, you can spend $20 and buy the value pack which includes 2 drinks, tub of popcorn, and a candy which makes you feel ripped off.  Or, you can pay a-la-carte and buy the normal size popcorn, split a large drink, and skip the candy so you can still feel ripped off.  I predict this is what would happen with a-la-carte TV.  The best thing you can do is sneak everything into the theater like so:

Buy these channels a-la-carte and watch them over your Internet connection where you already have access to Netflix, Hulu, and an over the air antenna.  So, you don't need 8 cable channels more like 1-3.  So your bill looks more like this:

Netflix - $7.99

Hulu - $7.99 (which is like your DVR)

Antenna - $0

3 cable TV stations over iTV - $24 (not available today)

Set-tops you don't need these with iTV - $0

Total - $39.98

Now you have a cable package killer.  Three "must have" $8 pay TV channels and two iTV subscriptions at $8 each.

But, until it can be done over the top so viewers can bypass their cable company, our cable TV bills will continue to be overly expensive.  It's the combination of a-la-cart pay TV and iTV that will truly bring down the cost for you and me.