[opendtv] Re: FCC Eliminates Simulcast Rules

  • From: Craig Birkmaier <craig@xxxxxxxxx>
  • To: opendtv@xxxxxxxxxxxxx
  • Date: Tue, 28 Sep 2004 09:50:52 -0400

At 7:27 PM -0400 9/26/04, Manfredi, Albert E wrote:
>I don't think so. We have the ABC, CBS, NBC, PBS, WB,
>and UPN channels, from Wash and Balt/Annapolis, we
>have Telefutura, and a couple of independents who
>broadcast foreign programs often, from various
>countries. PBS comes in several flavors, including
>from Howard University. In any event, there are
>smaller markets such as yours, where OTA choice is
>much less.

Agreed. But ALL of the above (except PBS) run off network syndicated 
programming during local access hours. And some of those you listed 
run off-network programming during prime time.

>Didn't you just finish saying that the conglomerates
>had to buy up other media outlets in order not to
>lose their audience on cable systems? If that's in
>fact what the dynamic was, i.e. if indeed the media
>giants didn't appreciate at first that people would
>migrate to a medium that gave them more choice (seems
>incredibly hard for me to believe!!), then by now
>they should have gotten the message.

What they have gotten is control... again.

>Consistency says that cable is a success thanks to
>the extra choice it offers, and that the same would
>apply to an OTA scheme. To a lesser extent, since we
>are such a "more is more" society.

Consistency says that you don't get something for nothing.  The 
conglomerates are not going to kill the goose that laid the "latest" 
golden egg. With the current model they get both advertising and 
subscription revenues for the non-broadcast networks. And they get to 
keep charging more for these networks every time a contract comes up 
for re-negotiation. Why would they give away something that people 
are paying a premium for today?

The only incentives for the conglomerates to offer for free what they 
get compensation for from the MVPDs would be if they could generate 
more revenues, or control more of the revenues generated today. This 
could only happen if they charged for the OTA multichannel service, 
or if they could run cable and DBS out of the business and still 
charge for the multichannel service.

For now, the current strategy keeps milking the market for as much as 
they can get.

>So again, the network that first uses multicasting
>intelligently can expect the same sort of benefit
>cable systems enjoyed.

Not even close. No single network has enough content to make such a 
service desirable. Even if all of the networks offered multiplexes, 
the choices would still be limited compared to cable and DBS.

>>  > Instead, if ABC, for example, offered me two or
>>  > three FTA streams, while NBC and CBS only offered
>>  > me one, I would be two or three times more likely
>>  > to watch something from ABC as I am now.

Only if those choices are appealing. How well do you think a 24/7 
news channel from CBS would fare today?

>The proof you already gave, since you claimed that
>the conglomerates bought out the other cable media
>outlets for this reason. I don't need to prove what
>you have already explained happened. If some cable
>users find stuff more appealing than the main
>stream of the major networks, how can you justify
>coming to a differenbt conclusion for OTA viewers?

IF OTA viewers could receive 40-50 of the most popular networks 
(broadcast and non-broadcast) then what you are saying might be true. 
This could be done, but not under the current regulations that 
control the DTV transition. And then there is still the issue of 
subscriber fees. If the OTA service attempts to collect subscriber 
fees, it is destined to capture only a tiny fraction of the audience.

>>  It takes millions of homes with the ability to
>>  receive these new digital multiplexes. For some
>>  reason, the politicians seem to be most worried
>>  about the last 15%, who may not have the means to
>>  upgrade their existing receivers.
>First of all, I consider that to be political grand
>standing. Anyone able to afford a TV at all, and
>able to pay an electric bill, can afford a $76

Where can I buy a $76  STB to receive ATSC broadcasts?

But more important, why would I spend a dime, as long as analog 
broadcasts continue?

>Secondly, that political grand-standing was also
>evident in Berlin, and didn't prevent the system
>from becoming a success. All it took was one
>simple action: shut off analog. That will work
>here too. Any other change, e.g. changing the
>affiliate model, might help. I just don't see
>that it's mandatory, as you do.

Apples and Oranges. The affiliate model and the regulations that 
protect analog OTA broadcasting are the reason that the UK/Berlin 
model will not happen here. All of this could change, but only when 
local broadcasters are willing to take their case to Congress and 
lobby for a new deal that lets them compete with cable and DBS by 
limiting the power of the conglomerates to control distribution.

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