System operator (SO) purchases broadcasting channels from program providers (PPs), allocates channel number to each broadcasting channel, and broadcasts those channels to subscribers (viewers). Channel allocation is the SO’s sole competence. There is no common rule for SO to allocate channel numbers to broadcasting channels. Usually channel numbers are randomly allocated irrelevant to the characteristics of broadcasting channels. Therefore the same broadcasting channel has different channel number across SOs. As a result viewers search lots of channels to find their most preferred channels. It generates huge search and learning cost to viewers. This article analyzes economic effects of ‘Clustering Channel Allocation’ that allocates adjacent channel numbers to broadcasting channels which have the same or similar characteristics using twosided market model. According to this article channel clustering increases viewers’ cable TV subscription, subscription rate, and SO’s profits. Viewers’ benefit increases or decreases depending on the size of reservation values of viewer.