It’s no secret that the pay-TV industry has lost customers in the last decade. It seems like everyone is pointing fingers at AT&T right now, although that’s unfair. People forget that while cable was losing customers left and right, DIRECTV was still growing until just a few years ago.
Yes there has been a drop in subscribers, but DIRECTV is still the largest pay-TV service and likely to remain so.
If you look at the reasons people drop pay TV, you hear the same things over and over. One common trope is that you pay too much for channels you don’t watch. Personally I don’t agree, but you hear it enough to realize a lot of people think that way. So I have an idea, something that I’d love for AT&T to try.
I call it “build your own bundle.”
It’s not a strictly a-la-carte plan, but I think it would appeal to people. Here’s the way it would work. You can pick 10, 20, or 30 channels that you want. You pay $1.50 a channel for the basics or locals, $3 a channel for the next tier up like Discovery and HGTV, and $10 a channel for sports channels. Build yourself a bundle that has the channels you want to watch.
Obviously the first thing people are going to say is “$10 a channel for sports?” and that’s going to be a tough sell. But really I’ve been saying for years that sports channels, especially ESPN, are what’s driving costs up. It’s been estimated that the average customer is actually paying up to $25 for sports channels. If they’re going to be “a-la-carte” they have to pay for themselves.
But putting aside that, I think you could build yourself a nice little package for between $30 and $50 a month that would just have the channels you wanted. For most people that would be locals and a few top nationals. And really, everyone would win. AT&T would look really smart and progressive and it might stem customer losses.
It would be an uphill climb though.
The biggest problem with this would be the content providers. They all have very specific contracts and I am willing to bet that most of these contracts wouldn’t allow this sort of thing. But hey, that’s what lawyers are for. If I were a smart AT&T lawyer, I’d offer each content provider more money per subscriber if they allowed this. AT&T would make more money per channel and they’d keep more subscribers.
There would also be the backend challenge of setting this all up but I think that would be a great use for a lot of the developers and engineers who have been sidelined because there isn’t as much new hardware coming down the pike as their once was.
I think it’s a fresh idea and I hope AT&T steals it. Obviously there would be challenges to something like this. It might be very hard to adjust to this kind of customer-driven model. Not only that, some of the less-popular channels might suffer enough that they’d either go under or go internet-only. But in the long run I think it could work. What do you think?