Wednesday, February 28, 2007

MLB.TV, DirectTV, and the Regulation of Choice...

Major League Baseball is considering a deal with DirectTV to offer out-of-market regular-season games to satellite subscribers. For around $200 for the entire season, DirectTV users could watch any baseball game that doesn't involve their their local team (blackout restrictions apply). Meanwhile, for $90 per year, people can alternatively watch all of those games on baseball's official website, MLB.TV.

There are a couple of components here that need to be addressed. First of all, regarding the possible DirectTV deal, there is a big problem that parallels what's happening with the advent of the NFL Network - consumers would not be allowed to purchase the programming they want unless they switch service providers (from cable to satellite). This is a regulatory issue, and the FCC, who is responsible for ensuring market competition while still acting in the "public interest, convenience, or necessity" needs to stop this deal from taking place. Senator John Kerry and FCC Chairman Kevin Martin have started to address how consumers should be able to purchase the programming they want (and while I'm on the subject, Senator John McCain has also in the past proposed badly needed legislation to prohibit cable companies from forcing people to buy channels they don't want).

The bottom line is that, as a wannabe customer, I shouldn't have to switch from cable to DirectTV. It would be like having to switch from cable to DSL internet service if I want to visit YouTube, but having to switch back if I want to use Hotmail. The FCC needs to ensure that the content is kept separate from the delivery.

Second, when comparing the $200 per year price of DirectTV to the $90 price of MLB.TV, one has to wonder if the internet truly is the future of the delivery of all television programming. Bill Gates has been saying so for years. My bet is that right now the only thing holding up its widespread adoption is that most people don't know how to set up their televisions to work as their computer monitors. Once this happens though, it's going to be hard for cable and even satellite to compete, due to the internet's inherently low cost structure, which ought to keep prices low, and its unique ability for customization through computer programming (go open source!).

I welcome the day when I can pay for the channels I want, not be forced to pay for the channels I don't, and have it all delivered through my high-speed broadband connection. In the meantime, I'm just glad that I live in the metro New York City area so that I can watch all the Mets games.


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