"My question is, how the hell can a cable company have monopolistic powers when the entire industry operates AS A MONOPOLY."

You're forgetting about vertical integration (e.g., Time Warner is both the cable company AND HBO) and monopsony power (i.e., not only few sellers, but also few buyers -- of content, for example).

Not that I'm a fan of antitrust, mind you...

The consumer choice in this industry, such as it is, is made at the city or county level, when the local authority decides which company will receive the franchise for that area. I can't imagine that that's a terribly competitive process even now, but cutting out one major player and giving its markets to the two biggest survivors arguably narrows that choice.

I approached the HBO thing in a very snide way in the title and the last line, but didn't really consider the implications. Good point. Though I confess, I fall on the other side of anti-trust. I think I should be able to get either comcast or time-warner in any neighborhood.

Oh and I don't understand (and this is the libertarian in me peaking out) why they don't offer a per channel service. Clearly they can do this with premium channels, why not with all the others? I really don't want Discovery Health...but Court TV????

As always in Antitrust, the relevant market is the key. And the relevant market here is _not_ "cable TV providers." It's the market of providers of Video Broadcasters -- cable _and_ satellite providers.

Also, you must not be aware of this, but several larger cities have "overbuilders," upstart cable companies that build their own cable lines in certain neighborhoods & then compete with the big guy -- Starpower/RCN in DC does that (I used them for two years, getting my digital cable, phone & internet from there, and they were great).

So the nationwide market for Video Service providers goes from X to X-1. I can't say what X equals, but it's probably about 5 or 6 -- Dish & DirecTV as the two satellite options, and then Comcast, Time Warner, Adelphia & whatever other cable companies still remain (overbuilders like Starpower are not, as yet, a true competitive threat, but they do exist & help keep the market competitive at the margins).

Also, probably the important market here from the Antitrust perspective is that for the buying of programming/content -- _not_ the provision of video services to consumers. Suddenly the providers of content have only X-1 (say, 4) instead of X (5) potential buyers of their product (a new channel, or whatever). Collusion among the remaining providers is much easier and more likely. Legally sufficient to support a blocked merger? Well, when the Dish Network wanted to buy DirecTV in 2002, the DOJ moved to block & succeeded, arguing mostly on a 3-to-2 market player reduction in markets nationwide (cable co vs. 1 Satellite broadcaster, where there had been 2).

The cable providers claim that per-channel pricing would end up being more expensive and would kill off the smaller channels. On the other hand, the channel that costs the providers (and thus the viewers) the most by far is ESPN, so it's not clear whether the big-station viewers are subsidizing the small stations or vice-versa. Who knows what's accurate; it's in every player's interest to keep their pricing opaque.

And Discovery Health has great stuff on it lately, like Medical Incredibles, or Strictly Sex with Dr. Drew. It's not all plastic surgery and pregnancy any more.

Yeah but Court TV has "Cops" and NO MORE NANCY GRACE!!!!!

J, I appreciate the remarks, though I need time to digest.