À-La-Carte Cable Is Here, And By “Here” We Mean “Canada”

Last summer, we shared with you the potentially exciting news that regulators in Canada were pushing telecoms there toward offering more à la carte cable options: the wacky concept of letting customers choose and pay for the stations they want. In real life, what that meant was that unbundled cable channels could come to our northern neighbo(u)rs. That reality is now here…sort of.

The Canadian government started gently encouraging telecoms to offer à la carte pricing to customers back in 2011. Industry estimates show that about 70% of cable customers in the province of Quebec have a very basic plan and then add on extra channels that they want. One company, Telus, has actually doubled its customer base since 2011 by marketing its à la carte options.

The cable industry in the United States has a lot to lose if it were to adopt this strategy, and it’s extremely unlikely. One analysis estimates that without forcing people to pay for channels they never watch, the cable industry would lose about half of the entire industry’s revenue. As a whole, cable is worth around $70 billion.

If Internet-savvy consumers conclude that they don’t need cable in the first place, telecoms can still extract more money from à la carte customers than they can from Internet-only customers.

Meanwhile, it’s a nice study in contrasts: the Canadian Interior Minister announced on TV that providers will be required to offer unbundled TV service, while U.S. Senator John McCain (R-AZ) has sponsored an un-bundling bill that has almost no chance of passing.

Cable TV firms face pick-and-pay law [Globe and Mail]
Cable TV Companies Forced to Unbundle in Canada [Bloomberg]