Cable group to Congress: Don't let ESPN jack up the cost of broadband
The American Cable Association represents small-town network operators, those who serve rural markets or more sparse populations, and speaks out on issues that are of special interest to their subscribers, specifically those issues which could result in increased subscription rates.
The group's latest issue deals with the site ESPN360.com, which features streams that rebroadcast various sporting events. However, if you are connected to the Internet through an un-affiliated service provider, which includes Comcast and Cox, all the streams on the site are blocked. The only official way to get access to the site's content is to switch to an affiliated service provider.
This sort of carrier-side bundling has been controversial for sports cable networks in the past. In late 2007, for example, Comcast actually had to sue the NFL to stop encouraging Comcast customers to switch to competing services which bundled the NFL Network into their basic subscription packages.
The argument against bundling is that the typical American consumer is interested in no more than 17 cable channels, which fall under the moniker of "highly desired programming." This will generally include Discovery, USA, MTV, and ESPN, but not the related sub-networks. When operators are coerced into including more channels into their basic lineup, the subscriber's rates must be increased, irrespective of his interest in the additional content. It can be looked upon as the majority footing the bill for content desired by only the few.
So now the fight has been extended to Web site bundling, and the American Cable Association says it could end up driving up the price of broadband access, just like it does cable.
ACA President and CEO Matthew M. Polka said, "By its own account, Disney's ESPN360.com business is not economically viable on its own, unless broadband providers are forced to charge all subscribers for this unwanted online sports content sought by a niche audience of sports junkies.
"Media conglomerates and other Web giants must be prevented from using their
market power to drive up the cost of basic broadband access, and deny
independent access to their Internet content for individual users," Polka continued. "The Obama Administration, Congress, and the Federal Communications Commission must take notice now before these high-cost 'closed Internet' business models are replicated and damage the prospect of universal and affordable broadband access."