Verizon FiOS to adopt faux a la carte pricing model

It's not quite a la carte, the so-called Holy Grail of subscription TV, but what Verizon (NYSE: VZ) is proposing for its FiOS TV service comes close to breaking the logjam of bundled channels currently clogging pay TV lineups. Call it "faux a la carte."

According to a story in the Wall Street Journal and reported on multiple sites, Verizon's top programming negotiator Terry Denson said that the pay TV service is considering a model where its 4.7 million subscribers would be charged only for the channels they watch, based on information culled from their set-top boxes. On top of everything else, this would not involve Nielsen, which currently gathers viewing information for ratings used to price advertising, but would use only viewership data available via the set-tops.

According to a report in Rapid TV News, this means that Verizon would track FiOS TV subscribers to determine if they had watched a channel for at least five minutes and attempt to pay programmers accordingly. Verizon would also use this usage information to develop personalized channel bundles that cater to consumer tastes rather than the bundled programming being offered by a number of big content providers.

"Smaller channels would also reap the rewards of being successful and are given a better chance against the niche channels that media behemoths force pay TV distributors to take in order to get a decent deal on top-rated sister fare," the story said.

That means subscribers, just through their viewing habits, could cull out some of the duplicated channels being pushed forward by players like Viacom, which delivers multiple takes on a theme like MTV, MTV 2, MTV 3 and MTV U, said a story in Venture Beat.

As with any a la carte scheme--faux or not--the move probably won't have a serious impact on the bottom line subscription charge, Denson told the WSJ. On the other hand, he said, pricing for each channel could provide a more stable environment and moderate annual bill increases.

For more:
- Rapid TV News carried this story
- and Venture Beat had this story

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