If MultiChoice were to allow subscribers to build their own bouquets, or choose individual channels, viewers could end up paying the same amount (or more) for fewer channels.
That’s the word from a MultiChoice spokesperson, who was commenting on a recent column in the New York Times which argued that channel unbundling would not save you money.
The assumption that removing a channel from a bouquet would let you decrease your subscription fee is not valid, the columnist argued.
This is because platforms such as DStv typically pay content owners carriage fees for their channels, with prices influenced by the size of the audience that the channel gets delivered to.
“The bouquet model enables the largest audience over a large number of channels, which reduces the cost for subscribers and creates more choice,” MultiChoice said.
“It also enables a large number of channels to be economically viable, especially those which may be considered marginal or niche channels,” the spokesperson added.
In other words, basing assumptions about what you would pay if you could choose fewer channels on the current bouquet model does not give an accurate estimate. The whole business model would have to change, which means the bouquet model as a pricing baseline goes out the window.
Sports enthusiasts would be the hardest hit, according to the New York Times column, as sports carriage fees (at least in the US) would more than triple if channels are unbundled.
Citing economist Dmitri Byzalov of Temple University, the article said that this is because only die-hard sports fans would buy in.
Those who don’t care about sports at all would probably benefit, as they no longer have to contribute to the carriage fees of expensive sports channels.
Casual sports fans would be worse off, as they may not find it worth paying the large subscription fees for unbundled sports channels.
Asked whether this argument, which revolved around the US market, also applies in South Africa, MultiChoice said that it does apply and is true for all genres of content, not just sport.
“[Bundling channels into bouquets] enables greater choice and consumers with varied interests will have access to channels at an affordable cost,” MultiChoice said.