Forrester Research has released a report entitled “Cable À La Carte Pricing Creates More Problems Than It Solves." The report concludes that only half of consumers are interested in à la carte but those that are interested in it greatly undervalue the cost of programming, envisioning artificially low prices can’t be sustained in the market.

The report notes that à la carte proponents base their arguments on three key points:

• Parents should have control over "threatening content."
• Since our economy is based on market mechanisms, with unrestricted choice yielding the most efficient outcomes, cable programming should succeed or fail based on consumers electing to choose channels.
• If consumers are able to opt out of channels they don't want, they will save money.

However, there are also three key practical concerns that reveals the flaw in mandatory à la carte schemes:

• Many households that watch family programming, are also likely to regularly watch networks for more mature audiences.
• Consumers are confused about the potential value of à la carte pricing.
• Expected savings don’t reflect reality.

 As the report – written by James L. McQuivey, with Remy Fiorentino, Bradford J. Holmes, and Heidi Lo – states:

In our research, we simply asked cable viewers to consider how much they would pay, if anything, to subscribe to any of 46 top cable channels, up to $10 a channel per month. Viewers chose a simulated bundle with an average of 26 channels, but were only willing to spend $24.08 a month, less than $1 a channel, half of what they pay now. Given the 8 hours of TV that US households watch daily, that’s about $0.10 per hour, compared with the $2.00 per hour we pay to rent a new release on DVD. In contrast, an hour of prime time costs advertisers $0.60 per head. At $0.10 per hour, à la carte pricing would never work: Producers and cable companies wouldn’t get paid enough to survive, and consumers would lose desired content.

You can find the entire report online at Forrester's website.