With lots of activity happening in the media and entertainment sectors in 2010, we’ve recently seen several stories about the carriage of programming services by cable and other video providers. This coverage has been partly driven by negotiations between programmers and operators about carriage fees, partly by retransmission consent disputes, partly by the growing prevalence of online video.

Many of the news stories and blog coverage have attacked the business model of multichannel video providers (which includes cable, DirecTV & DISH, AT&T’s U-verse & Verizon’s FiOS). Such arguments invariably lead reporters and bloggers to one of two conclusions: We need à la carte or all video should be available online to all consumers.

Over at AllThingsD, Peter Kafka revealed a rate card from an unknown cable operator that reveals what said operator pays each programmer for the right to carry their signals. Kafka thinks that the hidden cost of programming is the problem.

As I’ve said before, I think that many cable viewers are probably okay with most of the bundle–or at least unwilling to foot the bill for real a la carte pricing. But maybe if you waved this list in front of them, they might rethink that.

Of course, there are a few problems with this. First, there’s no way of knowing what these prices really mean. Could this be the same rate that all companies pay? After all, Wal-Mart doesn’t pay the same price for product as another retailer might. In addition, the “wholesale” price that a video distributor pays (or any business for that matter) isn’t the same price that a consumer pays, especially if you purchased channels on an individual basis versus the savings of a bundle.

At the Atlantic, Derek Thompson points out more problems:

Monthly cable bills are about $50, [Kafka] says. An American’s average monthly TV time is 150 hours (via Nielsen). So today we pay about 30 cents per hour of TV, right? Not exactly. Monthly cable bills are by household. Monthly TV hours are by individual. I live with two roommates. I pay $17 for cable and consume 150 hours of television. My TV experience costs more like 11 cents per hour.

Thompson also points out how a la carte would affect advertising and notes that this analysis doesn’t reflect how people watch TV in the real world.

…a great deal of TV time is spent “surfing” for nothing in particular, or watching shows to which we ascribe no real monetary value but we watch anyway because we’ve already paid the monthly access bill.

Eduardo Porter, in the New York Times, also argues that Americans might be more likely to pay for content if they knew what they were paying for, even suggesting that a coin slot attached to the TV or PayPal account would enable purchase of individual shows, regardless of which network they are on.  But all Porter has to do is look at the cost of pay-per-view to realize this is a much more expensive way to watch your favorite shows.

We’ve covered the topic of a la carte several times before, but the point is that cable networks will lose the broad carriage they have now and be forced to spend considerable money to market and sell the channel to individual consumers. Revenue goes down, operating costs go up. Programming will be impacted.

There’s usually a conclusion to all these “analyses,” even if they don’t say it flat-out: “If you would only move to à la carte or some kind of metered plan – then consumers would pay less.”

Except, perhaps, they wouldn’t.

In the past, the computer industry has offered solutions to bring together various kinds of content on one device (Think of Apple TV and Media Center PCs). It would definitely be handy to have a central way to access content, whether streaming video, stored video, photos, audio, or whatever.

Earlier this week, Cablevision announced the PC to TV Media Relay service. This LightReading.com article spells out the details.

Cablevision Systems Corp. said it will begin testing a new service in June that delivers all sorts of media sourced from a customer’s PC — including iTunes content, digital photos, and even over-the-top video shipped in from the Web — to digital set-top boxes.

Cablevision’s “PC to TV Media Relay” service will enable cable TV customers to replicate the information and images appearing on their PC screens onto their TV screens without any extra special home networking equipment, other than the cable modems and the non-IP digital cable set-tops they’re already using.

After downloading a special PC software client, you stream content from your computer up to the cable headend, and then that content is fed to a dedicated digital channel you tune to on your set-top box. You could connect your laptop to your TV now, but this service would eliminate the need for a VGA cable.

This VideoNuze post suggests this could have implications for other video services, but Netflix seems quite pleased at the announcement. I wanted to focus on two other elements.

This article on Entertainment Weekly’s site offers some criticism:

…Cablevision’s plan has the disadvantage of, well, requiring that you have cable — it only works if you have both Cablevision cable and Cablevision Internet. Quite simply, Cablevision is in the business of making sure you don’t drop your cable TV subscription when you discover you can watch just about anything online, while other HTPC outfits are in the business of just getting content on your TV.

…does Cablevision’s plan seem like best of both worlds (cable and Web content on your big TV screen), or does it just sound like having to pay one bill too many? Who’s already unplugged the cable from their TV and taking an Internet-only approach?

Yes, I know I sound like a broken record when I say this, but every time I read someone claim that you can replace cable programming through the Internet, I have to point out that you can’t. I most recently addressed this issue in a post, but the simple fact is that most full-length cable programming is not available online for free. There is a lot to watch, but not cable programming (for the most part).

My second point is that this new service is another example of cable shifting its resources to manage bandwidth. I have written in the past that cable is having its own “digital transition,” which is separate from over-the-air broadcast television’s DTV transition of last year. One important step is moving from analog to digital, which takes up less space. Another way is through sending content on-demand, such as with VOD or this new PC to TV Media Relay service. Yet another example is Cablevision’s announcement this week of an April deployment for remote storage-DVRs, a service in which content is stored on servers at the headend and then streamed to the home as requested.

This trend will continue, with cable’s infrastructure being used in new ways that will allow even more stuff to be sent over the pipes. Kyle McSlarrow made this point just last week:

Today, a typical cable system has a total capacity of 5 Gbps, meaning our typical customer already has well over 1 Gbps of data available to his or her household. Today, we use that capacity to deliver hundreds of channels of analog and digital video (including high-definition television) and phone service as well, of course, as Internet access. As new applications and services emerge and consumer demand changes, the cable industry is well placed to redeploy bandwidth to meet those changing needs.

Expect more developments along these lines.

We learned quite a bit this week about the National Broadband Plan – scheduled to be released on March 17 – which may end up being one of the most ambitious communications policy undertakings in recent memory.  There are a lot of tough and challenging issues yet to be addressed, but what we’ve heard so far gives us a much better idea of how comprehensive the plan will be, and helps shape our early thinking about how our industry can help.

First, in a speech earlier this week before NARUC, the association of state communications regulators, FCC Chairman Julius Genachowski provided the initial  preview – starting with his forward-looking challenge to the communications industries to provide Internet speeds of at least 100 Mbps to 100 million U.S. households by 2020.

Our industry remains committed to leading in the effort to meet America’s broadband goals.  That will require the continued evolution of the cable plant from a one-way, analog video programming service to a platform that delivers an ever-changing array of two-way, digital services; the continued deployment of next generation broadband; and continued innovation to use capacity more efficiently.

Today, a typical cable system has a total capacity of 5 Gbps, meaning our typical customer already has well over 1 Gbps of data available to his or her household.  Today, we use that capacity to deliver hundreds of channels of analog and digital video (including high-definition television) and phone service as well, of course, as Internet access.  As new applications and services emerge and consumer demand changes, the cable industry is well placed to redeploy bandwidth to meet those changing needs.

Most of this will involve private investment and private sector innovation.  But, as we have said before, there are clearly ways the FCC can help.  We appreciate the FCC’s recognition, for example, of the need to provide flexibility that encourages the continued deployment of switched-digital video which uses bandwidth more efficiently and low-cost set-top boxes which aid the drive to all-digital systems.  Measures such as these also promote the continued rollout of DOCSIS 3.0, a technology which offers speeds over 100 Mbps today.  Multichannel News recently estimated that DOCSIS 3.0 – commonly referred to as wideband – is currently being offered to more than 52 million U.S. consumers and businesses.

But while more than 90 percent of U.S. households have high-speed Internet service available, only about 65 percent have chosen to subscribe, according to a report released this week by NTIA.  As he has before, Chairman Genachowski correctly identified this broadband “adoption gap” as one of the key problems confronting us:

Right now, more than 100 million Americans that could and should have broadband don’t have it. Because they can’t afford broadband, don’t know how to use it, or aren’t aware of its potential benefits.

I was pleased to see him compliment NCTA’s proposed Adoption Plus (A+) Program, which would offer digital media literacy education, discounted computers, and discounted home broadband service to low-income families.  But there are many other good ideas out there — and the bottom line is that this challenge will only be met successfully by 1) treating it as a multi-faceted problem and 2) and addressing it through public-private partnerships.  Here too, our industry remains committed to be a constructive partner with other industries and government at all levels.

Second, the FCC’s meeting yesterday also offered a lengthy set of “working recommendations” by the broadband team that are intended to integrate broadband  into the nation’s key economic, government and societal priorities, including “high quality healthcare, world-class education, smarter energy tools, 21^st century jobs, greater public safety, more opportunities for civic engagement, and a better quality of life.”  Credit goes to the Chairman and his staff, particularly the broadband team, for placing broadband policy in its proper context.

In each of these areas, there is an enormous amount of work to be done, and some intriguing opportunities.  Many cable operators and systems have already embarked on unique partnerships and other relationships which advance many of these goals, including a new smart energy initiative launched earlier this month by the Society of Cable Telecommunications Engineers.

During our annual Cable Show last May in Washington, D.C., we showcased some of these projects at our Broadband Nation exhibit:

• A rural medical clinic where patients can access a custom video-on-demand library to learn more about their conditions and treatment, and use a secure broadband connection to share vital signs and electronic medical records for a video teleconference with a specialist hundreds of miles away.

• A broadband connected middle school that allows students to read a book with the author, research any video ever produced by C-SPAN, travel the world with Discovery’s vast online collection of video content, enjoy the unique experience of interacting with a Promethean smart board.

• A high-definition video conference center that uses broadband to improve communication and productivity by connecting co-workers that appear to be right across the table, when in reality could be anywhere in the world.

The Broadband Nation video below highlights the innovative services that were on display for the home, school, and office, as well as specialized applications for medical centers, schools, and retail and entertainment outlets.

In the days ahead, we look forward to learning even more about the National Broadband Plan.  There’s much work ahead of us, but I have no doubt we can make this shared vision a reality.

NCTA President & CEO Kyle McSlarrow is the featured guest on C-SPAN’s The Communicators program this week. The video is now available online, and will air on Saturday at 6:30pm on C-SPAN.

For more thoughts on the interview, check out John Eggerton’s preview of the show in Broadcasting & Cable.

UPDATE: Just a reminders that The Communicators also airs Monday on C-SPAN2 at 8 a.m. and 8 p.m. ET. You can also subscribe to the show’s podcast. If you’re interested in seeing the comments about Google, they appear about the 17:45 mark.

Regular readers will note that I keep returning back to the issue of cord-cutting, mostly because I keep reading articles and blog posts about how it’s the big new trend.

It’s not a question of whether more television content will move to the Internet or whether IP transport will be used more in the future for video distribution. It’s two questions:

a) Are a lot of people canceling their cable subscriptions for cord-cutting alternatives?

b) Can you replace your cable subscription through online video?

In a previous post I attempted to answer these questions, but it’s quite simple: a) No. b) No.

This debate does show that consumers have more choices than ever before, which one would hope can finally put to an end to the view that insufficient competition exists. I might argue that cable subscriptions provide the best combination of services and value, but those who don’t agree clearly have many other options.

This week also brought two new pieces of evidence which tend to support the subscription model, one scientific in nature and one anecdotal.

Parks Associates released the All Eyes on Video study, which looks at “consumer use of and interest in video experiences.” From this WorldScreen.com article, the report found that “Less than 8 percent of U.S. broadband homes — about 5.5 million homes — are considering canceling their pay-TV subscriptions in favor of online video…”  This Broadband TV News article reports the profile of these consumers.

The households likely to switch or cancel their services watch a whopping 10 hours of online video each week, much higher than typical video consumers. They express strong interest in having online access to pay-TV channels (e.g., TV Everywhere), which highlights an opportunity for traditional pay-TV providers to solidify their base through the deployment of such features. Offline video consumption is also higher. Their median number of DVD rentals from the last six months is 18, compared to two rentals among other households.

Janko Roettgers, in this NewTeeVee post, thinks that the real winners will be DVD rental services like Netflix and Redbox, although it’s worth noting that the DVD business is going through its own problems right now and Netflix does not yet have a deep catalog of content that can be watched online through its Watch Instantly feature.

The Business Insider’s Dan Frommer quite famously cut the cord on cable, as noted as recently as this December 2009 article on the proposed Comcast-NBC deal:

Nielsen recently reported that although online video viewing has risen 35 percent in the past year, 99 percent of TV viewing is still done on a traditional TV. But that’s not the case for younger people, like my pal Dan Frommer. He’s 27 years old and works as a writer for a technology Web site. Frommer pulled the plug on cable TV in May 2008 and instead gets shows from the Internet via a Macintosh computer hooked to his LCD television. He can’t get everything he’d like to see, but he’s saved $1,500 on cable-TV fees. “I’m not going to let myself get ripped off for a bunch of garbage that I don’t watch anyway,” he says.

And here was the title of a Frommer post yesterday: Why I Caved, Bought Cable TV, And Gave Up On My ‘Hulu Household’. Read it for yourself, but you’ll find many of the issues I’ve discussed here before; high-definition television, live sporting events and the costs of high-quality TV productions all play a role.

Final note: I draw your attention to this Mari Silbey tweet from Monday. Roku, frequently mentioned as one of those great alternatives to subscribing to cable, has recently talked about how subscriptions will play a greater role going forward. In fact, they’re “looking to line up at least 100 content partners this year.”

Mari tweeted, “I’m sorry, but does no one else see the irony of Roku’s plans to bundle free hardware with subscription content? It’s called a cable set-top.”

The more things change…