[opendtv] Re: Fewer than 2 Million have OTA DTV in US


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John Willkie wrote:
I believe I answered this in advance.  Local-into-local in 1999 "unleashed"
the DBS business; access to local channels provides much of the draw for
cable.

We will, apparently, get a couple of chances in the near future to see what
happens to a cable system or systems without local channels.  If I've read
news reports accurately, on January 6, 2007, MediaCom loses access to
Sinclair stations in multiple markets.

MediaCom has replaced local channels in some markets with not-so-local
stations with the same networks.  Maybe those 'distant' stations will change
to include coverage of the distant markets; most likely they won't.

So, MediaCom cable subscribers who can't get the signals over the air or
don't want to try, will have the option of satellite local-into-local or
distant stations.  It will be interesting to watch.

That will indeed be an interesting experiment to watch. But I'm surprised that cable companies can deal with a distant affiliate of a network in competition with the local one. I thought the local station would have an exclusive contract with the network for that area. Is that changing, or not the case?

Also, Tom, you've minimized the "economy of scale" argument.  Local stations
that affiliate with networks have the same benefit of that economy of scale.
Imagine a station in Tulsa trying to produce something as well-produced and
popular as "Desparate Housewives."

The economy of scale argument for the networks works TWO ways; national
exposure for their advertisers, and the tie-ins with their owned and
operated stations.

I don't disagree here. My reference to economy of scale was just in comparing non-network non-affiliate stations with those somehow carrying network or nationally desirable content. Any dollars per minute paid to produce or acquire content can obviously be MUCH higher given the potential viewing eyeballs of national exposure. So they can afford to throw more money at having better content based upon the larger viewing, larger total ad sales, etc.

- Tom


John Willkie


-----Original Message-----
From: opendtv-bounce@xxxxxxxxxxxxx [mailto:opendtv-bounce@xxxxxxxxxxxxx]
On Behalf Of Tom Barry
Sent: Sunday, December 24, 2006 6:32 AM
To: opendtv@xxxxxxxxxxxxx
Subject: [opendtv] Re: Fewer than 2 Million have OTA DTV in US

The numbers I'd like to know have more to do with what is the value
added of a local channel?  Do people really want local channels because
they are local?  Or do they just associate the more popular local
channels with the network channels?

The national network content obviously has a vastly greater economy of
scale and basically can have a lot more money invested in it based upon
the expected number of viewers.

But if people were to estimate a cable bill reduction based upon losing
some single channel, would they prefer to lose a local unaffiliated
channel or (assuming they had one) a national network channel from one
of the big 4.  How much new discount would they likely expect from each?

I sometimes wonder if there is really marginal demand for local content
and it is just the more costly national content they might want.

Have there been any studies on this?  For instance, what percentage of
non-network local channels negotiate retransmission consent instead of
using must carry?  Are those figures available anywhere?

- Tom


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--
Tom Barry                       trbarry@xxxxxxxxxxx     
Find my resume and video filters at www.trbarry.com


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