By Carl HoweToday, the Wall Street Journal reports (sub. req.) that the FCC is suggesting that cable companies allow consumers to buy channels a la carte instead of in bundles, as they do today. Bundling, of course, has been a marketing strategy to get consumers to trade up to more services in everything from software suites to car features for years. Cable TV has been one of the biggest proponents of bundling to raise average revenue per user (ARPU) and to be able to afford large amounts of programming.
But the trend today is actually the reverse, all because of the tyranny of too much. Now companies are unbundling products to unlock hidden value. Apple's iTunes music store has been selling music by unbundled songs for 99 cents as well as by $9.99 albums. And the reality is that almost no one really subscribes to cable TV for the dust and dirt channel.
So this will be a big change for the cable industry that will challenge it just as Verizon and AT&T come after them with must-lose-money TV. In my mind, there's no question that the cable companies can survive and thrive in this world, but they'll have to get a lot smarter about creating simple, smart packages rather than bloated tyranny of too much product offerings. The question is, will they?