U.S. Consumers Pay $1,600 Annually For Cable TV Channels They Don’t Watch
One of the reasons that propaganda mills like Fox News don't take a bigger hit from advertising boycotts is because U.S. consumers pay billions of dollars annually for the channel, even if they don't watch it. More specifically, Fox rakes in $1.8 billion in carriage fees to include the channel in bloated cable bundles, despite the fact that just 3 million of the nation's 90 million cable TV subscribers actively watch.
Of course, this extends to other channels as well.
One new study estimates that U.S. consumers pay $1,600 annually for cable TV channels they never watch thanks to the dated, bloated, traditional channel bundle model. It also found that the average cable subscriber has access to 190 channels-but only regularly watches 15 of them. All the while, the average cable TV bill has grown 52% in the last three years, from around $96 to $147.
Customers have been cutting the cord" (axing traditional cable TV) at an historic rate, and it's not particularly hard to see why:
By paying $147 per month to watch only 15 channels, the average pay-TV customer shells out $9.57 per channel watched - an amount that rivals the monthly cost of most streaming services.
That per-channel price is even higher for the many viewers who watch fewer stations. Less than 50 percent of pay-TV subscribers regularly watch more than 10 channels, and less than a quarter regularly watched 20 or more channels in their subscription.
Streaming providers are also seeing slower growth because, in part, everyone (including top streaming outfit Netflix) is continually raising rates on users. I thought research firm MoffettNathanson issued an investor note that aptly captured the current state of the TV industry:
Many of the media companies have made conscious decisions to strip-mine their cable networks, shifting their best content to their streaming platforms. At the same time, they have raised prices relentlessly to offset declining viewership. Both strategies have alienated distributors, who are now more ambivalent than ever about trying to retain video subscribers who are themselves increasingly ambivalent about lower and lower quality video services for which they are asked to pay higher and higher prices.
You might recall the push for a la carte" TV channels (being able to buy cable TV channels individually) was even a pet project of the late John McCain in the aughts, though his legislative efforts on that front never really went anywhere. The cable industry rejected most requests for such pricing by claiming it would drive up prices for consumers (this, if you didn't notice, happened anyway).
And while the rise of streaming competition has mitigated the problem significantly (42% of Americans have ditched cable TV and gone broadband only), the tactic of forcing US cable TV consumers to buy massive bundles filled with channels they don't watch remains a very real annoyance. And, in the case of ongoing financing of Fox News, in more ways than one.