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In restaurants and television, it’s bundles all the way down

Tyler Cowen summarizes the great small-plates debate by way of analogy to cable packages:

big plates are like a “take it or leave it” cable contract, and small plates are like the a’la carte cable pricing schemes.

It's a clarifying analogy, but as much about cable packages as about entrees.

Small plates can be delicious, just like a Saturday Night Live sketch can be funny. (Deb Lindsey/For The Washington Post)
Small plates can be delicious, just like a Saturday Night Live sketch can be funny. (Deb Lindsey/For The Washington Post)

Over the last few years, the big debate about cable has been whether we'll move from huge cable packages to a la carte pricing in which you simply choose the channels you want. But it increasingly seems the answer will be...neither. Instead, various kinds of cable bundles will compete against other kinds of content bundles, like Netflix and Hulu and Amazon Prime. The question consumers face isn't which channel, or to go even further down the a la carte rabbit hole, which series. It's which bundle.

Perhaps, once the cable industry gets really desperate, they'll try to move toward a la carte pricing. But by the time that happens, thinking about this space in terms of "cable channels" will seem ridiculous. At the moment, the category of "stuff you can watch on your television" is largely split between cable channels, which broadcast in real time, and online collections like Netflix, which mostly give you access to libraries of older content. But give it 10 years and the real-time space will be flooded with online content, too.

In restaurants, too, it's just bundles battling bundles. Just about no one chooses a restaurant based on whether they have small or large plates (and most places that do "small plates" also do at least a couple "large plates"). They choose a restaurant based on what's available on the menu. As with the media space, the decision is really about which bundle is better.


- Why a la carte cable won't save you as much as you think.



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Neil Irwin · June 30, 2013

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