Sen. John McCain just picked up an unexpected ally in his seemingly quixotic effort to pass a law that would promote a la carte pay TV pricing. Liberty Media CEO Greg Maffei — whose company is the largest shareholder in Charter Communications, and usually opposes regulation — says “there are many positive attributes” to the bill, although he questions whether it can pass. Maffei’s comment stood out at the Goldman Sachs Communacopia Conference, where analysts have been asking execs what they think about McCain’s effort and the idea of breaking up the pay TV bundle. Programming execs at the event including Disney’s Bob Iger, Viacom’s Philippe Dauman, and Scripps Networks’ Ken Lowe all but scoffed at the idea, saying that consumers are satisfied with a system that serves them well. But Maffei says that programmers’ ambitious recent price hikes threatens what he calls the “wonderful ecosystem in the television business…When you see what’s going in on places like Los Angeles with eight regional sports networks, you threaten that benign feedback loop and it’s not a good thing.” If companies don’t solve the problem then “you risk some regulatory intervention.” Cable companies now find “scale and horizontal consolidation attractive” — in part to gain leverage in negotiations with programmers. He wasn’t pressed on the latest in Charter’s effort with Liberty to combine with other operators including Time Warner Cable, Cox, and Cablevision, although he offered that “I’m not sure we have to lead the [consolidation] charge.” Meanwhile, Maffei says that cable companies should experiment “more aggressively” with broadband rates that replace the popular all-you-can-eat model with ones that require heavy users to pay higher prices. “It seems only logical and fair….Testing that and getting consumers attuned to that sooner rather than later would be a good thing.” Usage-based pricing probably would pose big problems for streaming video services including Netflix.
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