Choices Matter! So, why don’t we have them when it comes to cable boxes?

On our behalf, consumer advocacy groups have argued for a la carte pricing options to replace cable programming bundles.  Paying for networks we didn’t watch bothered many of us for a very long time.  Yet, the industry effectively argued back that it would take just a handful of networks purchased on an individual basis to get to a sum in excess of our existing bundled prices.  A stalemate persisted until technology changed and new entrants (e.g. Netflix) disrupted the status quo.  We now see the beginnings of unbundled programming and more choices for how, when, and what we view.

There continues to be no choice, however, when it comes to the set-top box that is needed to convert encrypted signals from the cable operator to each cable-enabled TV set in the home.  In a recent study, Congressmen Mackey (D-MA) and Blumenthal (D-CT) found that the average cable household spent $231 per year renting cable boxes (approx.. 2 boxes/household * $9.50/month *  12 months).  You sign up for Comcast’s Xfinity service, you get Comcast’s cable boxes.  You sign up for Verizon’s Fios service, you get Verizon’s cable boxes.  You get the picture…no choices.    It represents a nearly $20 billion revenue stream for the cable firms, so, at the moment, they have no incentive to change the business model.  If we are lucky, technology changes and new entrants in this segment of the video programming market will make renting cable boxes “into perpetuity” a thing of the past.