[opendtv] Re: NAB, MSTV applaud FCC must-carry proposal for DTV transition

  • From: Craig Birkmaier <craig@xxxxxxxxx>
  • To: opendtv@xxxxxxxxxxxxx
  • Date: Fri, 3 Aug 2007 10:32:25 -0400

At 8:34 PM -0700 8/2/07, johnwillkie wrote:
Here's where you are wrong: the FCC isn't proposing this, only one member
responded when asked by a House panel that summoned them.  The FCC was
against the idea, and that is your "fcc proposing legislation."

Maybe it would be best to wait and see what the FCC actually decides. But Martin has put the proposed dual carriage rules on the table...

It will not cost anything for cable to continue to offer analog versions of broadcast channels other than the extra spectrum they will occupy and the retransmission consent fees that the stations will charge. Perhaps the cable guys can use dual carriage to help offset these negotiated fees.


Here's a hint: read first, then comment.

More tomfoolery: yeah, dual carriage is a "problem" for cable companies,
because they can only charge once for it.  Kind of funny that the real dual
carriage problem -- broadcasters with dual illumination and no extra revenue
-- hasn't ever seemed a problem to you.

In theory cable cannot charge for either analog or digital carriage, but in practice, cable passes through all costs to the consumer. So the consumer will pay one way or another.

Broadcasters ASKED for DTV. They were frustrated in their original goal of getting 12 MHz of spectrum for an HDTV augmentation scheme, which would have resulted in a permanent dual transmission scenario. And they have frustrated everyone with their foot dragging on the transition, causing the 700 MHz auctions to be delayed by nearly a decade. If they were really concerned about that second power bill, they could have taken steps to accelerate the transition.

BUT THEY DID NOT.

The reason they have been dragging their feet is simple:

Retransmission Consent.

The industry is getting hundreds of millions in retrans consent fees; in a few years it will be billions as every station gets compensated by cable and DBS for their signals. Some how, I suspect that this is enough to cover those power bills.

So, lil didn't supercharge satellite because it cut their churn rate by
about 65%, it ONLY doubled their subscribership (during the same time, cable
subscribership dropped.)

I doubt that you can document the above statement, especially as it relates to churn rate. There is no question, however, that DBS did take a byte out of cable, once they had the ability to offer a comparable service that included the networks. I would only point out that this would ALSO have been true, IF they had been allowed to offer the east and west coast feeds to anyone that wanted the networks. Instead, they had to invest additional billions to deliver every local station in the U.S. It would not surprise me if this cost more than ALL broadcasters have spent on the DTV transition.


Cable didn't notice much defection to satellite before lil.  Afterwards,
they did.  Ask them if "supercharged" is too strong of a word.

DUH. As I stated in the previous message, the first marketing thrust for DBS was to provide multichannel services to those who cannot get cable. It took considerable additional investment to offer LIL so that they could compete for existing cable customers.

What supercharged cable was the ability to offer broadband, a service for which the DBS companies do not have the spectrum to compete. As a result, cable has only lost a small number of subscribers in total over the past decade. Where cable lost out to DBS was in the potential for additional growth. When you have >70% of a market, new growth is obviously more difficult.


Once again, MUST CARRY/RETRANS isn't from the FCC, but from legislation.  It
won't be overturned in your lifetime, unless broadcasters want it
overturned.

What does this say about America.

The public is sucking the hind tit.

First come the interests of the politicians, who have become dependent on the television medium to maintain their power;

Second come the interests of the franchisees, who depend on the politicians to protect their oligopolies so they can charge far more than the service is worth;

Third come the interests of the content oligopolies who depend on the politicians to extend copyright well beyond its constitutional intent;

And at the bottom of the list come the consumers, who "own" the resource from which the political power flows, but ultimately pay through the nose for all of these government regulated
services.

Actually, broadcasters seem to be getting more comfortable with negotiated carriage. They could probably get by without retrans consent, but must carry is still important to all of the broadcasters that hardly anyone watches.

If a test case were to make it back to the Supreme Court today both must carry and retrans consent would be overturned. That is why an appropriate test case is so important.

Have you noticed that almost everything that the FCC tries to do in terms of granting more power to its franchisees is being overturned by appeals courts? They are walking on eggshells, and it is becoming increasingly difficult to keep the house of cards from collapsing.

Regards
Craig



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