The FCC has come out in favor of unbundling cable channels.

It has been a trend in American living rooms for decades: Every year, the cable television bill goes up as consumers receive ever more channels they do not want or cannot find the time to watch.

But in a frontal assault on business as usual, the Federal Communications Commission, in a report issued Thursday, said consumers would save as much as 13 percent on their cable bills if they could buy only the channels they wanted instead of being forced to pay for hundreds of them. The average household, the FCC said, watches only 17 channels.

I’ve often wished for something like this, or perhaps a pay-per-view per-show option (i.e. view an individual episode of the Sopranos without subscribing to HBO).  So far, all of the on-demand options for something like this only apply to existing subscribers (in the above example of the Sopranos, you can watch anytime, providing you already subscribe to HBO).  We’re starting to see a little movement into this area, with pay-per-view shows being sold via the iTunes Music Store. 

But on further thought, I can’t help but wonder how well this will work out.  My previous thoughts were with regards to price, in that I’d expect the cable operators to find a way to raise effective rates, but hide them in the per-channel billing.  But there’s also the issue of networks funding their niche offerings through bundling them with the more popular channels (which is a rather socialist approach when you think about it).

It looks like it’s going to require the development of a whole new approach to revenue to pull this off.  That, or a bunch of smaller channels will go away.