© Depositphotos / Nomadsoul1

For years, a la carte, the notion that pay-TV viewers could subscribe to individual channels instead of big bundles, has been a thought experiment as likely to become real as soup on a stick. Now there’s something similar brewing in the US Senate Commerce Committee, and it has already prompted interesting revelations from broadcasters and pay-TV operators.

Quick Background: To allow Dish Network and DirecTV to retransmit local stations to their markets, Congress had to pass a law; the most recent version of that law is named STELA, for Satellite Television Extension and Localism Act. That law expires every few years, forcing Congress to pass a new version or renew the old one, as it did in 2010. That extension expires on Dec. 31, 2014.

In July, the House Judiciary Committee quietly passed an essentially unchanged version. In August, the chairman of the Senate Commerce Committee and its ranking minority member tacked on “Local Choice,” a bipartisan, cunningly simple plan to overhaul the retransmission consent system. Under this plan, each local station would offer its signal to pay-TV subscribers for a given price. Each subscriber could choose whether to purchase each local channel. This way, stations would get market-based value but viewers would avoid pay-TV blackouts from retransmission contract renewal disputes. The senators also released a dull slideshow explaining this relief from “one of the fastest growing items on cable and satellite bills.”

Local Choice’s status is still uncertain, partly because it’ll be difficult to get such game-changing legislation passed by the end of the year. What I find most interesting are the unusual, revealing comments that it has sparked from both sides.

First off, Local Choice is strongly supported by the pay-TV industry, as you might have guessed. That stance refutes a common pay-TV argument against full a la carte – cable and satellite companies have no problem handling the billing and logistics of individual subscribers choosing individual channels. Keep that in mind when you hear the industry claim that separate charges for MTV and Comedy Central would be too difficult to manage.

On the other side, broadcasters hate Local Choice. Robert C. Kenny, in his blog for TV Freedom, a broadcaster-backed group, wrote that “the Washington pay-TV lobby is manufacturing a crisis regarding broadcast TV blackouts when, in reality, hundreds of deals are quietly reached each year through free-market retransmission consent negotiations.” Broadcasters often claim that their deals with pay-TV companies are “free-market,” but they’ve actually got them over a barrel; how many subscribers will stay with a service that doesn’t include the local CBS channel? Local Choice provides an unusually frictionless example of free market economics, and that scares the heck out of broadcasters.

Just yesterday as I watched football, I switched from my Dish Network feed to the sharper OTA signal sent from my local broadcaster to my rooftop antenna. If I had the option to save a dollar or two, I’d drop some of my satellite-delivered locals and use OTA instead, but that’s because I’m hip to the fun of free TV. In the unlikely event that Local Choice passes, it could launch a renaissance as more people discover the power of the antenna.

Riga (Latvia) Radio and TV Tower
©Depositphotos.com / amoklv

I don’t usually talk about radio, but I’m inspired by Rocco Pendola’s column in The Street last Friday. In short, radio station KNDD in Seattle has issued the 2 Minute Promise, to never play more than two minutes of commercials at a time. Also, the promise includes cutting the number of commercials played per hour in half, and not firing disc jockeys to pay for the promise. Pendola wrote that a Fresno CA station followed by promising to play no more than five minutes of commercials per hour.

Pendola wrote that this makes the remaining ads more valuable because they aren’t buried 10-deep, and presumably they’ll play to more listeners. It’s a way to regain listeners who might have rejected radio for Pandora, Spotify or other streaming music.

That all reminded me of Americans For Responsible Advertising, or AFRA, a non-profit group dedicated “to make Americans aware of the extent to which they are exposed to commercial and noncommercial (e.g., political) advertising and to false, misleading, offensive, and abusive advertising in particular.” According to an AFRA report (PDF), the weeknight national news shows of NBC, CBS, and ABC average 8 minutes of commericals per half hour. If news shows run 16 minutes of ads per hour, it lines up with a Nielsen report, quoted in the Los Angeles Times, that the average commercial time on broadcast TV is over 14 minutes per hour, and on pay-TV networks, almost 16 minutes per hour.

The Times story mentioned one side-effect of so many ads. “The rise in commercials likely will concern some marketers who fear their spots are being lost in all the ad clutter,” it wrote. “Also, as more viewers embrace digital video recorders, many of those ads are being lost to the fast-forward button.”

Sounds like the same problem that radio faces, with consumers increasingly interested alternatives to an increasing load of advertisements. Imagine if broadcast TV tried a similar solution: Cut back on the number and length of ad breaks, and make sure the public hears about the change. Maybe if the change sweeps radio stations, it’ll leak through to TV.