Principles in Practice: The Blog of the Objective Standard

Tuesday, September 25, 2007

Make TV Free

Posted by ARI Media at 8:20 PM

Irvine, CA—The FCC plans to consider banning television content providers from bundling mainstay channels with less popular ones when negotiating broadcast terms with cable companies. This is seen as the first step to eventually forcing cable companies to offer cable channels to consumers "a la carte," rather than as part of a bundle. According to FCC chairman Kevin Martin, "If you only want one channel, you shouldn't have to take ten or twenty."

"This is an example of the government trying to solve a problem it created," said Dr. Yaron Brook, executive director of the Ayn Rand Institute. "In a free market, if consumers wanted to purchase cable TV channels 'a la carte,' there would be cable companies trying to cash in on that demand. But the TV industry is not a free market—at every level, the government controls and regulates it.

"Most cable companies, for example, are government-protected monopolies in the markets in which they operate, preventing consumers who are unhappy with their service from patronizing a different cable provider. At the same time, a tangled host of regulations and restrictions enable content providers to strong-arm cable companies into accepting bundled channels or else pay high retransmission fees.

"The end result of such regulations, and others like them, is that cable companies are both protected and hamstrung from freely trading their services at a range of price-points and channel combinations. It is ridiculous to think that the solution to this regulatory mess is more regulation.

"What we need is freedom in television, where content providers, cable companies, and consumers are free to deal with one another on mutually agreeable terms, without government interference or government favor."

Labels: Business and Economics, Individual Rights and Law