Is Cable Television a Monopoly - 727 Words

Is cable television a monopoly? According to the theory of the invisible hand of the marketplace, as advocated by Adam Smith, the marketplace naturally determines the optimal price of a good or service. But even Adam Smith viewed the development of monopolies with some trepidation and believed that government intervention was required to cease their proliferation. During the 1980s to the 1990s, it seemed fairly clear to most industry analysts that cable television functioned as a monopoly in a manner that was deleterious to consumers. Cable television had few competitors, except in the form of analog rabbit ears which did not provide the full range of channels or quality that cable provided. In many areas, only a single cable company dominated the market and subscribers had few alternative options. However, in the era of the Internet, the market has changed. Cable television has been challenged by many alternative venues of media consumption, most notably in the form of the Internet. There has been some competition from satellite TV players and (in a few areas) TV over IP (Masnick 2008). Thanks to the rise of Netflix, Hulu and hardware like the Roku box and Apple TV, cutting the cord to cable TV doesnt mean cutting yourself off from your favorite shows and channels (Glaser 2010). However, most high-speed Internet consumers receive their Internet connection from the cable company, which indirectly funnels money to support cable TV. While consumers can useShow MoreRelatedEssay on Natural Monopoly1091 Words   |  5 Pages| Natural Monopoly | Telecommunications Law and Regulation Week 2 | | | | | I believe that times change and as they, change rules and regulations must adapt to the times. Therefore, the treatment of the different industries must represent the different industries as they grow. I do not think the Telephone and Broadcast should never have or ever be considered a â€Å"Natural Monopoly†. The concept of natural monopoly presents a challenging public policy dilemma. On the oneRead MorePerfect Competition : The Market Price Of An Product1391 Words   |  6 Pagesseparate pricing for cellphones. All other major carriers followed suit.). Monopoly markets have one provider for a good or service. With no competition to influence demand or supply, the monopolist offers less goods than demanded at prices higher than competitive market forces would dictate. Monopolies are notable for their market power (can raise prices without losing customers). U. S. drug manufacturers are an example of monopolies, as they have exclusive rights to sell goods in the US (even though competitionRead MorePerfect Competition : The Market Price Of An Product1394 Words   |  6 Pagesseparate pricing for cellphones. All other major carriers followed suit.). Monopoly markets have one provider for a good or service. With no competition to influence demand or supply, the monopolist offers less goods than demanded at prices higher than competitive market forces would dictate. Monopolies are notable for their market power (can raise prices without losing customers). U. S. drug manufacturers are an example of monopolies, as they have exclusive rights to sell goods in the US (even though competitionRead MoreMergers Essay606 Words   |  3 PagesMergers The Federal Commerce Commission conditionally approved ATTs acquisition of cable company MediaOne. The Department of Justices Anti-trust division conducted its own separate anti-trust merger review and proposed a consent decree with ATT which requires the merged firm to divest its interest in the cable broadband ISP Road Runner and to obtain Department of Justice approval before entering certain types of broadband arrangements with Time Warner and America Online. 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Time Warner C able has the name originated in 1992 by a merger of Time Inc cable television Company American television and Communications Corporation for two years the two companies operated separately until in 1992 when they finally merged into the name Time Warner Cable. In March of 2009, Time Warner the parent company of Time Warner Cable spun offRead MoreEssay on Comcast Marketing Strategy826 Words   |  4 PagesComcast has been losing analog cable television customers while at the same time seeing reduced growth of subscribers for its new services. For example, Comcast added 247,000 digital cable subscribers in the 4th quarter of 2008, which is less than half of the 530,000 subscribers they added at the same time the previous year (businessinsider.com). Comcast is the largest cable company in the United States. In most of the regions that they operate, they are almost a monopoly. In Maryland alone, theyRead MoreMedia Policy Of The United States1458 Words   |  6 Pagesmedia system. The US politicians have always pushed for the expansion of media — both at home and abroad — and of Hollywood. Washington has primarily been about â€Å"supporting US commercial media, encouraging competition and discouraging the sins of monopoly†. Broadly, the US government orchestrated the growth of its information industry in three ways: 1) Policies, ranging from subsidies to the setting of technical standards, 2) Laws and regulations for media ownership in commercial markets, and 3) Public