Tuesday, November 03, 2009

Andrew Coyne on the Consipcuous Rent-Seeking All Over Our TV Screens

He has it absolutely right, and he says it a bit better and more amusingly than I did.
Sorting through the duelling barrages in the interminable public relations war between the cable and broadcast industries over “fee for carriage” — now mercifully coming to an end — I find myself agreeing with both sides.
In any logical universe, there would be a simple solution to this. In that universe, the broadcasters could charge a fee for their signals if they wished — but cable companies would be under no obligation to carry them. Cable companies could pass on these fees to consumers — but consumers would not be forced to subscribe to channels they didn’t want. Instead of forbidding broadcasters to charge for signals the cable companies are obliged to carry that consumers are then forced to pay for, nobody would be forced or forbidden to do anything.
But that’s not the world we live in — not in this country. In this country, everything is decided by the CRTC, everything is based on force, and as a consequence, nobody has any incentive to share or compromise: it’s winner take all, depending on who can get the CRTC to side with them. So rather than focus on making better programs, or cutting rates, or otherwise improving their product, both sides spend inordinate amounts on crude propaganda campaigns trying to sway the public their way, and thus to pressure the CRTC and/or the cabinet to award them the prize.
Note too that this arrangement is one that is profoundly anti-market, but also likely pro-business. The broadcasting and cable incumbents probably find it more congenial living in a world where they need only lobby a handful of politicians and bureaucrats, rather than take the risks inherent in the logical world Coyne describes. On the other hand, that logical world is much better for us consumers, who I would like to think are the people that matter. However, once a government starts intervening, it is by fay organized lobbying interests who are bound to win.


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