Market Talk

The latest spat between Disney (DIS) and Cablevision (CVC) prompts some to wonder whether the cable industry will ever embrace an a la carte pricing structure.

The long-running feud between TV broadcasters and cable operators has intensified in recent months. Disney and Cablevision struck a deal last night to restore ABC’s feed to Cablevision subscribers just as the Academy Awards were kicking off. Same sort of dispute occurred a few months ago as talks between Time Warner Cable (TWC) and News Corp (NWS NWSA) went down to the wire, with News Corp threatening to pull access to the Fox network. But the two sides agreed to a last-minute deal on New Year’s Day. (News Corp owns Dow Jones Newswires, publisher of this blog.)

Other disputes haven’t ended without major disputes. The Food Network and HGTV – owned by Scripps Networks (SNI) – were blacked out on Cablevision for three weeks in January before the sides could reach a deal.

The longer these battles between broadcasters and cable operators last, the more likely consumer outrage will increase and FCC “will have the cause it seems to have wanted to require a la carte pricing for cable,” says CUNY journalism professor Jeff Jarvis.

A la carte pricing essentially allows consumers to pick and choose which stations they will pay for instead of paying higher rates for access to hundreds (if not thousands) of stations that most people don’t even watch.

“Then both broadcasters and cable operators and their parent companies will get their just desserts,” he writes. “I will not pay for 90% of the channels I am forced to pay for now. That will reduce revenue to cable. It will mean that many channels will no longer be subsidized. It will kill marginal channels.”

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Google’s unorthodox vision to sell its own Android smartphone directly to consumers without an exclusive wireless carrier has its pros and cons.

Google’s plan will enable it to more tightly integrate its Web services in the device, adopt new business models and limit its need to share revenue with wireless carriers, according to research from Broadpoint AmTech. But key risks will be pressure on margins, competition with its current Android partners, possible failure and losing focus.

Still, plans to sell the Google phone, called Nexus One, without a carrier partner is a big victory for the “unlocked phone movement,” writes Fred Wilson, principal of Union Square Ventures.

Unlocked phones allow consumers to choose any networks they want, but they’re generally more expensive because they don’t have carrier subsidies. Wilson says carriers should focus on improving network reliability, manufacturers need to build better devices and software developers should focus on improving operating systems.

“This is the PC architecture and I’ve been hoping we will see it emerge in mobile,” he says. “I think the Google phone is a big step toward getting there.”

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