In January 2010, News Corp. negotiated with Time Warner Cable, demanding that it pay $1 for each subscriber to the Fox Broadcasting Network. Although the end result was not disclosed, Time Warner Cable announced in January that its prices would go up. This negotiation is a sign of things to come as more and more networks battle with broadcasters for extra pennies per subscriber. Undoubtedly, consumers can expect to continue to see the price of cable packages go up. According to CNN, cable prices increase by about 5 percent every year, which means that the average cost could rise to $95 a month in five years.
As seen through these examples, competition and innovation benefit the consumer with a great product at a competitive price. It’s when the competitive environment shrinks or business methods become stale that the customer gets a raw deal. In the wake of a bad business deal, consumers should never be afraid to exercise their right to walk away and seek new alternatives.
– Keld Jensen is chairman of the Centre for Negotiation at the Copenhagen Business School in Denmark.
