[opendtv] Re: "And while the broadcast business has big problems in general..."

  • From: Craig Birkmaier <craig@xxxxxxxxx>
  • To: opendtv@xxxxxxxxxxxxx
  • Date: Thu, 26 Jan 2006 22:35:55 -0500

At 12:03 PM -0500 1/26/06, Manfredi, Albert E wrote:
>Craig Birkmaier wrote:
>>  So Bert...
>>  If two huge media companies cannot launch successful
>>  broadcast television networks, what make you think
>>  that local broadcasters can attract viewers with local
>>  content and/or re-runs in the DTV multiplex?
>Gee, Craig. And if it's hard to keep merely five OTA
>channels running, imagine the insanity of trying to
>sell people 150 channels -- for a monthly fee, to boot.
>Must be impossible. Can't be done.

It's being done but for the most part broadcasters have nothing to do 
with it. Scripps Howard is one of the only "broadcast station groups" 
that has managed to develop successful TV networks for the 
multichannel services.

Most of the content developed for cable is not available to local 
broadcasters for syndication. These networks compete with the content 
from from broadcasters, and they also like the revenues they get from 
cable and DBS subscriber fees.

We agree that it would be possible to fill the DTV multiplexes with 
networks that consumers actually watch  - in aggregate they are 
watching the non-broadcast networks more than they watch the 
broadcast networks. The problem for broadcasters is how to convince 
these networks to make their content available for carriage in DTV 
multiplexes, and how to pay for them.

If a network is carried in the extended basic tier of cable or DBS 
services, the network will receive subscriber fees for every home 
that subscribes to the extended basic tier in that market. This 
represents about 75-80% of the homes in most markets. Are 
broadcasters willing to pay for content based on the total number of 
homes in their market? Can they generate enough advertising revenue 
to pay these fees and still make a profit?

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