Cable TV shelf space
A New Jersey TV producer's effort to establish a new cable channel dedicated to the martial arts tells the tale about the structure of the oligopoly control of cable access. The Philadelphia Inquirer article (“Why few niche channels ever make it to cable TV”, 6/4/2004) shows how difficult it is for small companies to get new channels to be carried on the cable networks.
The martial arts channel has had the same fate as dozens of other proposals. As the article notes: “What are the chances that his channel -or any new channel, for that matter – will make it? Not good, judging by the numbers.” New channel introductions nationwide slip each year. In 2002, only eight new ones were picked up by any cable service or satellite service..
The biggest problem is bandwidth. Comcast, for example, already has many of its 300 slots filled with existing network, pay-per-view, music channels, and other programming. The shelf space is already all but taken, making the little room that does remain all the more valuable.
The remaining shelf space is almost all digital, but only 30% of subscribers can receive digital cable.
Moreover, cable networks are unwilling to raise basic cable fees, and are thus unwilling to pay money to any new network, if they can't see an immediate return. Add to that the growing demands for a la carte channel selction, and smaller channels are even more than ever to pull their own weight.
Most of all, the cable companies own a scarce resource that they are unwilling to give away. If they do adopt new channels, it will because of pressures from companies like Comcast and Disney that already provide important channels and try to bundle the older ones with the new ones. Becoming more likely, especially for Comcast, is the desire to produce their own minor channels, in some cases (Outdoor Life) snapping them up and buying out small companies' ideas.
As Comcast's vice president of programming is quoted as saying in the article, bandwidth “is our most precious resource.” [Oligopoly Watch]