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In 1995 if I wanted multichannel television service with local broadcast stations, i had one choice: my local government franchised cable operator. Today, i can get that service from that same cable operator. Or from Dish. Or DirecTV. Or Verizon.
Now I'm wondering if you know what competition is.
Also, a funny thing about competition. In 1992, the only multichannel provider was cable tv. Congress, at the urging of the broadcast industry and the support of Democrats, passed a bill giving broadcasters "retransmission consent" rights -- the right to demand payment from cable operators for carrying the local signals. For a decade or so, there was a basic equilibrium at play: the local broadcaster needed the cable operator to reach viewers and the local cable operator wanted to be able to provide local broadcast stations to its subscribers. But as satellite and then telco-video competition emerged, the broadcasters figured out that they could force all multichannel video distributors to pay them big money to ensure that they had access to American Idol or the Super Bowl or other programming that viewers considered "must have." So the amount paid for broadcast programming went from $28 million (with an "m"
in 2005 to over $6 billion (with a "b" last year.
Moreover, the same competition between cable, DBS, and telco-video has allowed non-broadcast programmers to jack up the prices they charge as well. If you are a cable operator competing for subscribers with Dish and DirecTV, you don't want to be the one that doesn't offer subscribers ESPN.
To top it off, back in 1992, everyone was concerned with vertical integration -- the fact that a substantial portion of the most popular non-broadcast networks (such as CNN, HBO, MTV etc etc) were owned by cable operators. Today, the only company with significant vertical integration of cable programming and cable systems is Comcast. Time Warner Inc, Viacom, and others have spun off their cable system properties. But that hasn't led to the most popular cable networks becoming "independent". Nope --now they're mostly vertically integrated with broadcasters: Disney, Fox, CBS. (Viacom and Time Warner Inc remain the exceptions - no broadcast properties or cable properties). And the 1996 Act had nothing to do with it -- there isn't anything in that legislation that changed the law with regard to the ownership of non-broadcast networks by broadcasters.
So if you want to know why your cable bill is going up, its' because the cost of programming is going up. That plus the billions invested in high speed data and telephone. You want to know what competition is? Its the fact that I can and do get landline phone service from my cable company and not from Verizon anymore. Its that I can get high speed data from Verizon or my cable company. It's that I get unlimited long distance service for next to nothing now, thanks in part to the availability of Skype as an alternative. And I can choose between Verizon, ATT, T-Mobile and others for my cell service and wireless Internet service.
Its truly awful. Sooooo much worse than in 1975. Not.
