OFFICIAL EXPLANATION



Two points of view are expressed in the argument: consumer groups claim that a la carte pricing will reduce consumer costs, while the cable television industry claims that the current package pricing structure is most cost effective for consumers. If the goal of the government is to reduce the cost of cable television for consumers, it is critical for the government to determine which point of view is correct. The cable television industry favorably compares the cost of buying bundled channels to the cost of buying those same channels individually, but what if most consumers would choose to greatly reduce the number of channels purchased? That could mean that a la carte pricing would result in lower cable bills for those consumers.

(A) The government's decision is based only on the costs to consumers, not the number of channels available to them.

(B) The government's decision is based only on the costs to consumers, not the advertising profits of the cable television companies.

(C) CORRECT. If consumers would not choose to order all of the channels they currently buy as part of a package subscription, then the cable television industries' claim that a la carte costs always would increase is faulty. If most consumers only watch and wish to pay for a few of their favorite channels, a la carte pricing could very well result in lower cable bills for those consumers. Consumers who want to purchase more channels could still choose the package subscriptions, so a la carte pricing would not harm them.

(D) The government's decision is based on only the costs to consumers, not the current purchasing agreements that exist between the cable television companies and content providers.

(E) The government's decision is based on only the costs to consumers, not the technical equipment requirements a change in cost structure would require.

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