Cable service providers in the United States are obligated to offer lesser watched channels if they want to carry some of the more popular names. Companies such as Viacom (VIAB), Comcast (CMCSA) and others have bundled these smaller, more niche channels to service providers for years, however cable companies are starting to fight back. Cablevision (CVC) recently filed suit against Viacom over this practice and other providers such as Verizon (VZ) are looking into new and “disruptive” payment models.
The Wall Street Journal reports that Verizon is seeking partnerships with several “midtier and smaller” media companies about paying for channels based on the number of subscribers that actually watch them, rather than a set rate. The company’s strategy will allow it to offer a larger number of smaller and independent channels to its subscribers, however big name media conglomerates who benefit from the current packages will be less likely to agree to the deal.
Terry Denson, the company’s chief programming negotiator, notes that if the proposed plan is successful it could eventually “stabilize retail prices for consumers,” although prices could also increase “due to consumer consumption.”