[opendtv] Re: News: Scripps Finds Way Around Cablevision Blackout in N.Y.
- From: Craig Birkmaier <craig@xxxxxxxxx>
- To: opendtv@xxxxxxxxxxxxx
- Date: Fri, 8 Jan 2010 08:17:32 -0500
At 5:37 PM -0600 1/7/10, Manfredi, Albert E wrote:
It makes sense. The content owners SHOULD finally be smart enough to
be able to bypass roadblocks in delivery of their content. The high
penetration rate of MVPDs suggests either of two things, or some of
both:
1. The MVPD prices are so low that the vast majority of households
has no problem subscribing. So the MVPDs can go ahead and raise
their rates to cover the increasing demands of content owners.
I doubt that many Americans think that the rates for any "utility"
they use are low. Unfortunately, these things have become necessities
of life and most people think they have no real alternatives.
The thing that makes the MVPD model work is that the increases have
been incremental, and this will continue to happen. People tend not
to rebel when the bill goes up a few bucks a month.
The other problem is that retrans consent has provided the MVPDs with
a fabulous excuse for annual rate increases, and they have done a
good job of growing their total number of channels, so that the
average cost per channel has remained relatively constant over the
past two decades. Yes you pay more, but they tell the politicians
that you get more too.
The reality is that each time the rates are raised both the content
owners and the MVPDs reach a little deeper into our pockets. The
acrimony surrounding retrans consent negotiations and threats to
withhold content during these negotiations provide great cover for
the reality that both sides love the current situation.
2. Content owners have been very unflexible in how they deliver
their content, and have allowed themselves to become overly
dependent on third party umbillicals. That being the case, they are
very vulnerable to the vagaries of negotiations with these
umbillical local monopolies.
Vulnerable?
They are DEPENDENT on the new revenues they are generating via
subscriber fees...
Soon they will be addicted, if they are not already.
I have yet to hear of a negotiation where subscriber fees were reduced.
As usual, it is up to consumers to take control back. It is only
then that the brakes are applied to the desires of the supply side
of the equation. Consumers have to stop playing the victim card all
the time.
To some extent they are.
But it is important to be wary of getting the politicians involved.
There were huge public outcries about rapidly rising cable rates in
the late '80s into the early '90s. So the politicians intervened to
protect us via the 1992 cable act. That's when the rates really
started to go up, as the congloms used retrans consent to build new
cable networks and take over most of the networks created by the
cable industry.
As long as consumers remain addicted to their TV habit it will be
possible to keep charging more. Only when people stop watching will
the gluttony stop.
Thankfully this has already happened for the broadcast networks,
which have lost more than half their audience to non broadcast
networks. Unfortunately people have simply changed their drug of
choice. The next stop on this train is when we learn that the total
time spent watching TV is in decline. I believe it already is,
however, if the mass media can help the politicians lie through their
teeth, we might consider the possibility that they are lying about
how much TV we watch too.
Regards
Craig
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