Television Is Not Free and Does Not Want to Be

[Commentary] The TV spats of the past few weeks -- between Cablevision and the Walt Disney Company over payments for ABC, and between Time Warner and the News Corporation over Fox -- suggest that the future lies in the opposite direction from free.

Americans watch 153 hours of TV a month, on average, according to a Nielsen survey. On prime time, ABC has a 9 percent share. At $1 a month, a rough, back-of-the-envelope estimate (assuming families watch TV together) would suggest Disney wants, at most, 7 cents an hour from the average Cablevision subscriber to watch its shows. Compare that with today's price of TV. Cablevision's basic "family cable" package costs $55.95 a month, which works out at most to 37 cents an hour per home. That is cheap compared with the real price we pay for television: 18 minutes out of every hour that we are expected to spend watching ads. Those 18 minutes are much more valuable to me and you than they are to ABC. A study in 2009 estimated that advertisers paid about $230,000 for a 30-second spot on ABC's "Desperate Housewives." That amounts to 79 cents an hour for each of the 10.6 million homes plugged into the show on Sunday nights. But if average hourly wages are $22.05 an hour, 18 minutes of the average workers' time are worth $6.60.

Imagine a world in which information isn't free. Your TV set is fitted with a coin slot — or a PayPal account. Wouldn't you rather pay 79 cents for an hourlong show to get rid of the ads? Technology might move us inevitably in this direction. Broadcast TV networks are badgering cable systems for money because falling ad revenues are forcing them to find new sources of income. Digital video recorders that offer customers the ability to strip out commercials could hasten the trend.

If we're lucky, we'll get a world in which TV is not free, but we will only pay for it when we want to watch it.