Working Theory
What follows is a thought experiment based on the theory that if you do not charge cable customers for any channels that they do not want, they will in turn be willing and able to pay more for the channels they do want.
Step One
Make ESPN a premium channel. To make this explanation a bit easier, let's just say, it's $10 per month (for all the ESPN channels as a bundle). But I think it could easily be less.
No, this would not increase your monthly bill under this plan (keep reading).
Step Two
Offer a required Basic Tier with any five non-premium channels, selected by the customer, for $20 per month. This tier would also include all local and public-access channels.
Step Three
Offer each additional non-premium channel for $1.00 per month. Channels can be added and dropped online with, say, 30 days notice.
Examples
ESPN Customers
So the minimum cable bill would be $20 per month. If you are an ESPN junkie, and let's take the extreme case - you watch little else - then your bill would be $30 per month. And with that you get five extra channels, plus all the local stuff.
What about those folks who just love having 100 channels?
Well, not that they watch all of them, right? But let's say that's what you need; your bill would be $115 per month. That is before any premium channels including ESPN. If you need ESPN in addition, your bill would be $125. Plus you would get all the local stuff.
What about most of us?
Let's see, most of us like sports, so sure, we want ESPN. And we want all the local stuff. And we love CNN and Fox News and the Weather Channel, and a handful of other cable channels. So for this example, let's say we watch as many as 30 different non-premium cable channels from time to time.
Basic Tier: $20
25 Extra channels: $25
ESPN: $10
Total: $55
And I think 30 channels is a lot. I bet if you really think about it, you watch fewer than that. For non-sports-fanatics, such as myself, this is a $45 plan. And the truth is, I could probably get by with, say, 15 channels. That would be a $30 plan. 10 cable channels? $25 per month.
And there is room to be creative here. For example, buy the ESPN premium channel, get Lifetime and Hallmark for free (so take those two out of your selected five). Something for him, something for her.
Local-Only & Single Premium Packages
Finally I see no reason why the providers cannot continue to offer a local-only package, without any cable channels, for say, $10 per month. I also see no reason why the providers cannot offer premium channels without either the local package or basic tier. So that ESPN customer above, could pay just $10 per month for that one channel or bundle. Or ESPN plus local for $20 per month. When compared to the existing system, that is an incredible bargain for the sports fanatic. Same with HBO and other premium channels.
Goals
Of course we want to lower monthly bills for most customers. But we also want a plan acceptable to the providers. The networks would almost definitely need to give up the bundles they now foist on the providers (if you want X channel, you must also carry the Y and Z channels). For this plan to work, the providers would only pay networks based on the current subscriber count for each individual channel. And so under this scheme, some of the least watched cable channels would necessarily go out of business. But as currently constructed, we are subsidizing them anyway.