June 26, 2007

So What We Have Here is a Market Inefficiency

THE BASIC LAWS OF ECONOMICS teach us that when supply equals demand, there is a wonderful place called equilibrium, in which all the wants and needs of producers and consumers are satisfied. Suppliers provide their goods and services for a reasonable price, and customers pay said reasonable price for those goods and services. Then, there is much rejoicing.

Sometimes, though, this joyous apple cart is upset and the harvest becomes endangered, particularly if a supplier, (S), holds a monopoly and an intermediary (S1), holds a near-monopoly, on providing a scarce service. Thus, even though demand among end consumers is high, the failure of the supplier and the intermediary to reach their own happy equilibrium creates an artificial shortage among end consumers. Then, there is much wailing and gnashing of teeth, and the people are cast out unto the darkness, and forced to watch ice skating competitions on television instead of a third football game on Thanksgiving.

Sadly, such a situation is apparently taking place between the Comcast cable network and the Big Ten Network television channel.

According to media reports, the BTN wants Comcast to put its channel, which will feature all manner of sporting events and other programming from the storied athletic conference, on the carrier's "basic tier," thus ensuring it will reach all Comcast subscribers. However, the BTN also wants a large sum of money per subscriber. Comcast's proposal has been to put the BTN on one of its expanded sports tiers, for which subscribers pay extra each month.

I for one am hopeful that Comcast and the BTN will come to a fully equitable solution for both sides. While I live outside the BTN's core eight-state market, I am a native of that market and would certainly be willing to pay extra to receive the BTN here in New England. By "pay extra," I mean, "I don't care what it costs." (Well, up to a point, anyway). This is because, to be perfectly blunt, collegiate football broadcasts in New England leave a lot to be desired.

I mean, my God. Loyal Rant Readers, you would not believe the college games broadcast up here. It's like a giant college football desert. I mean, on some of the smaller stations, they broadcast the Ivy League, for Pete's sake. I have nothing against the Ivy League -- after all, Harvard is the Michigan of the East -- but I've seen games broadcast where there are just a few thousand fans in the stadium. I recall one game -- it was Penn playing somebody -- where there were practically NO fans in the stands due to a giant rainstorm.

Fortunately, the marquee Big Ten games get national coverage, but as you can guess, on any given Saturday the regional and local broadcasts can be downright ridiculous. There are few things worse than clicking on the program guide and finding out that you COULD have been watching a great game, but instead must watch some wretched Regional Action featuring crappy teams in the ACC.

Said Regional Action often involves the Boston College squad, which is understandable given that I live about an hour away, but there's just one problem: I hate Boston College. And while it is fun to root against the Eagles I would rather have the chance to root against teams in the Big Ten, such as pathetic, whiny Wisconsin, which did I mention always makes sure it has an easy schedule? Plus, there are few things as fun as watching a struggling team (cough *Illinois* cough) knock a mid-tier team (such as, oh, Michigan State) right on its ass.

Simply put, the depth of the conference and the rivalries in the Big Ten -- which actually has eleven teams -- makes it the best conference for football watching television, bar none, and --

SEC FAN: Hey! Shoot, y'all can't say that! Why, Florida --
ME: Not so fast, my friend!
SEC FAN: OUCH! You -- you just hit me with a frying pan! Why, you no good damnyank--

-- right. Where was I? Oh, yes, the best conference to watch on television. You see, the Big Ten is almost always in a state of flux, not only between the top-tier teams but also among the middle tier, and as such those matchups can make for some fascinating games. This is as opposed to the ACC, unless I get to root for Wake Forest, and as opposed to the SEC, where I'm usually rooting for the defense, or some hapless team like Vanderbilt.

So, anyway, I am hopeful and confident Comcast will come to an equitable agreement with the BTN regarding the airing of the Big Ten's games, and that it can end this peculiar and unfortunate market inefficiency. However, if it doesn't work out, I'd love a side agreement ensuring a direct feed to my apartment, particularly for any late afternoon or evening games, after I get out of work.

And if it doesn't work out, well, I guess there's always 2008. Besides, it's not ALL bad -- after all, unlike some poor unfortunates, I do get the NFL Network here in New Hampshire, for which I am very grateful and for which I pay extra money every month. (I also get two soccer channels, a tennis channel, a racing channel, several college sports channels, and, among others, Bloomberg. Why Bloomberg is included in my sports package I don't know, but I guess it has to do with the fact that people who get excited about sports also probably get excited about how the Hang Seng is doing).

Posted by Benjamin Kepple at June 26, 2007 10:16 PM | TrackBack
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