Competition Slowly Coming to Television

The cable television business has long been one of the most uncompetitive in America. Most households are served by only one cable company, and most households are unable to get satellite. A truly stupendously lucky consumer might have the ability to choose between one of three vendors. Consequently, the whole landscape is pretty dystopian. But cable companies do face a somewhat broader set of competitive pressures from the entertainment world writ large.

Tim Duy says he’s through with cable:

I see that Comcast just raised cable prices. I find it remarkable that cable companies apparently can not see the train wreck ahead. I figure that I can drop the cable and the phone (who uses a landline anymore?), ugrade to a faster internet connection and still come out ahead nearly $100 a month.

$100 a month will buy more AppleTV rentals than I can watch, especially given the vast amount of free content now available. Pay a dollar, rent a show commerical free, or watch online for free with limited commerical interruptions. Skip the middle men of the cable companies. How long do the cable companies think they can last charging people for dozens of channels they never watch? I don’t see how that model survives.

I think I love sports too much for this to work for me. But my fondest hope is that more people will start doing this and Comcast and its ilk will start feeling some heat to deliver a better product in order to justify the prices they ask for. The problem, as I see it, is that the broadband internet market is itself not very competitive and the cable companies are major players in it. The mobile data universe, for all its flaws, features much more robust competition and I don’t think it’s any coincidence that this is where we’ve seen all the exciting gains in the past few years. This uncompetitive broadband market has for years now been this lingering problem that everyone knows about and nobody really seems to do anything about.