Time Warner Cable subscribers, brace for rate hikes

The cable and satellite companies are right about higher programming costs. Companies like Disney and Fox insist that distributors pay millions of dollars for fat packages of channels, regardless of whether viewers want them.

Time Warner customers, for example, are estimated to pay about $5 a month for Disney's ESPN sports channels, even though they might not ever watch them. They pay for Spanish-language stations even if they don't speak the language.

At the same time, cable providers have seen a steady exodus of TV subscribers as online alternatives such as Netflix and Hulu increasingly provide more programming options.

The nine biggest cable companies nationwide lost about 420,000 video subscribers in the third quarter of last year, according to Leichtman Research Group. Some of these folks made their way to satellite companies, which added 48,000 subscribers over the three-month period.

That means Time Warner and other cable companies are asking fewer TV customers to carry an ever greater share of their costs. This can't go on indefinitely.

The answer is clearly to allow cable and satellite subscribers to pay only for the channels they want. As it stands, the industry is hostage to the whims of channel providers, which have no incentive to change things.

The average TV viewer regularly watches about 17 channels, according to ratings company Nielsen. So-called a la carte pricing is the solution.

As I've written before, cable and satellite companies should apply their considerable lobbying clout to persuading lawmakers that it's not in consumers' interest to have to pay for products they don't need or desire.

Otherwise, the way things are going, there won't be enough customers left to support the pay-TV industry. And that's not in anyone's interest.

David Lazarus' column runs Tuesdays and Fridays. He also can be seen daily on KTLA-TV Channel 5 and followed on Twitter @Davidlaz. Send your tips or feedback to david.lazarus@latimes.com.

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