FanPost

DirecTV and the Pac-12 Network

DirecTV is still declining to pick up the Pac-12 Network, despite a pretty high-pressure campaign from the network and what appears to have been a successful first year. DirecTV's position is that they want to carry the network as an option. Viewers who want it, pay for it; viewers who don't, don't. The Pac-12 Network wants DirecTV to include it as part of a base offering, so the cost would be distributed across many viewers, which is the deal they made with Xfinity, for example.

As a Husky fan, I'm naturally biased in favor of the network -- I think carrier should be begging to include it. But the assumption that DirecTV can correctly assess its own benefit/cost is difficult to overcome. Is DirecTV just making a mistake? Not likely. I would have dropped DirecTV in order to get the Pac-12 network, but apparently that's not a particularly popular position, i.e., I noticed that DirecTV is still in business. Perhaps a more interesting question is, What makes DirecTV different from other providers? Why is Xfinity willing to add the Pac-12 Network to their sports package, but DirecTV isn't? I don't have an answer; maybe somebody else does.

Fortunately, I don't have to rely on DirecTV, so to me this is mostly an interesting negotiation. It highlights the value of a competitive market for maximizing value to the consumer. In the end, the network and the carriers will settle one arrangement or another. Whatever that is, it will very likely be close to the optimum. They would like to push each other around, they'd like to dictate terms and force the other to accept them, but they can't. They have to constantly think it terms of consumers, who, on the margin, have lots of options for what they watch and which provider they use. This is all to the good.

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