[opendtv] Re: Broadcasters Lobby FCC for Cross-Ownership and Duopolies

  • From: Craig Birkmaier <craig@xxxxxxxxx>
  • To: opendtv@xxxxxxxxxxxxx
  • Date: Tue, 20 Jul 2010 06:56:47 -0400

At 5:56 PM -0500 7/19/10, Manfredi, Albert E wrote:
Take a broadcaster, like Sinclair, that transmits the CW network in a given market. 

Then take an MVPD, like Time Warner, that creates HBO.
Sinclair is not generating the content, but the MVPD is. HBO is available nationwide on DBS and on cable systems, yet Sinclair cannot transmit HBO or anything else nationwide.
Actually, Time Warner Cable and HBO are separate divisions of a large conglomerate. Time Warnet Cable buys programming like HBO just like Sinclair buys programming.
The difference is that Time Warner Cable collects monthly subscriber fees for most extended basic channels and much larger monthly fees for premium channels like HBO - and now they can also sell movies on demand to individual subscribers. Their tw0-way infrastructure lets them track your usage in a manner much like Ma Bell charged you for long distance calls. And this infrastructure is allowing them to deliver targeted ads to individuals.
Sinclair has no ability to collect any money from viewers and they have no way to know who is watching what, except via ratings services like Nielsen. But they can negotiate with Time Warner Cable for retansmission consent fees for the channels they broadcast that are carried by Time Warner Cable. And Sinclair can only sell shotgun ads that at best target specific demographic groups.
HBO is available nationwide, just like the broadcast networks. And like the broadcast networks, HBO has a large number of affiliate cable and DBS systems. But these affiliates have a financial relationship with individual customers that allows them to charge and collect monthly fees for these premium channels. It is also noteworthy that HBO does not create much content - most of the content they deliver is produced by the movie studios. Thanks to the monthly fees they have sufficient revenues to produce a few of their own shows and to deliver them WITHOUT advertising (although one could say that HBO IS a promotional arm of the movie industry).
I don't think we can assume anymore that OTA broadcasters generate content. Many generate only some local news and weather, and some don't even do that. The broadcasters that can be claimed to be generating REAL content are the O&Os, owned by congloms.
Not really. This is no different than a Time Warner Cable system offering HBO, which they buy from another division of the same conglom. The ONLY difference between an O&O station and an affiliate is that the parent corporation (the network) gets all of the profits generated by the O&O. The network O&Os also buy content from the syndication market just like affiliates.
If O&Os are disappearing, as they are, it's high time the FCC and the Congress take that into account and level the playing field. 

HUH?
Only a few smaller stations have been sold by the networks. They are all near their national caps. But broadcasting is becoming a secondary outlet for most of the content created by the congloms and the handwriting is on the wall. It is far more likely that the networks will sell their O&O stations as the broadcast business continues its downward slide, than the possibility that they would buy up affiliates to create a national network, if allowed to do so by the government.
Craig seems to think that FOTA is doomed anyway, so he couldn't care less. I am actually grateful to people like Craig. They pay the subscription fees that make the content owners happy, and I get to watch at least some of that content without the subscription fee! What a deal!
You get what you pay for Bert. You are paying for content at the check-out counter every day, including the stuff you can't watch because you don't pay subscriber fees. Advertising is just like taxes Bert - it's buried in the price of everything we buy. You just choose not to pay twice. 

Regards
Craig


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