The Skinny on Verizon’s Skinny FIOS Bundle

The Verizon “skinny” bundle.  What is it?  What does it mean for consumers?  Will it change how people buy cable and satellite television packages, or more importantly, will it finally change the way these companies sell packages to consumers?

The skinny bundle offered by Verizon is actually called Custom TV, and is offered through the company’s FIOS TV product.   The package starts out with 30 base channels, and then lets the customer add two “Channel packs” for around $55 per month.

The base channels are locals and very low demand channels in the grand scheme of things, so they cost Verizon little to carry and offer to customers.  The “packs” are organized into genres, so to speak – so you could select Sports and News, or Pop Culture and Lifestyle, for example.

From there, you can add an additional pack or two, for $10 a month.  The other three packs are Kids, Sports Plus, and Entertainment – so there are seven packs total to choose from.

Its the first step toward what consumers ultimately want, a la carte television service.  Reports indicate that while the average customer has almost 200 channels in their cable TV lineup, they watch about 17 of those channels.

The package offers and alternative to cutting the cord, which many consumers have been reluctant to do, especially sports fans.  You still get your locals, and then you get to select the channels that appeal most to you.  So what is the problem?

For consumers, there really isn’t one.  For big media, its another step towards the complete destruction of their business model.

For years, media companies have bundles multiple channels together and offered them to cable and satellite providers like Comcast and DIRECTV.  Terms required that the company take all of the channels, and then place them on agreed-upon tiers.  In the end, the consumer foots the bill for dozens of channels they don’t really care about, even in low end packages.

Big networks like ESPN, owned by Disney, are already taking action against Verizon and their skinny bundle – as they have accused them of breaching contractual terms.   The case is still pending, and may be the first domino to fall and lead to massive change in the way customers buy their pay television service.

In the meantime, FIOS TV customers are the real winners.  With the skinny bundle option on the table, why would they pay more to a satellite or cable company in the same market?


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