At 10:09 AM -0500 12/21/06, John Shutt wrote:
DTG operates the Digital multiplex, in much the same way you have advocated the broadcast utility model. With the BBC paying for much of the usage, they in effect are subsidizing the service. They also provide much of the content.
According to the Freeview website:Freeview is managed by DTV Services Ltd, a company owned and run by its five shareholders - BBC, BSkyB, Channel 4, ITV and National Grid Wireless. Launched in October 2002, the Freeview service provides free-to-air digital TV channels, radio stations and interactive services through an aerial.
There are four main BBC channels, and two BBC operated news/public service channels out of the more than thirty channels now offered. So I stand by my original statement that very little of the license fees go toward the operation of Freeview.
Does DirecTV or Dish offer a free tier of DBS service here in the US? Why then does BSkyB offer a free tier? Hint: It has something to do with that 131.50 GBP ($257.52 USD per annum) licensing fee.
BSkyB offers a free tier because they are partners in Freeview and they want to get people to subscribe to additional services. By offering the free tier they can give potential subscribers the same content as Freeview, and the ability to pay for additional content. I don't think that the free tier on BSkyB has ANYTHING to do with the license fee. It is simply a reflection of competition among multi-channel services- something that we do not have here in the U.S.
That being said, I expect that we will see some kind of free programming tier on the DBS systems in the U.S. in the next few years. They have peaked with the current business model and need something additional to continue to attract new subscribers. And I would not be surprised if cable offers a free tier when the NTSC transmitters are turned off.
There is no question that competition would bring down the cost of TV in the U.S. Unfortunately, the FCC seems to think that the addition of Telco TV will bring about competition in the U.S. This is laughable. The Telcos will get on the same bandwagon as cable and DBS, gladly collecting subscriber fees for the media conglomerates. The FCC noted that cable rates have gone up about 96% in the past decade. SOME of this is due to the addition of more channels to the extended basic tier. MOST of this is due to the subscriber fees that we now pay for channels that are advertiser supported.
If broadcasters were to run a service like Freeview in the U.S. this expensive house of cards would topple. OR. if the FCC would require the multichannel services to offer channels on an ala carte basis, most of the subscriber fees would disappear.
Bottom line, most U.S. viewers are paying SIGNIFICANTLY more than the U.K license fee for "Free TV."
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