The news story has received national attention: Some 3 million Cablevision subscribers in New York and New Jersey are being deprived of Fox Network programming because Cablevision, the local cable MSO, and Fox cannot agree to terms on retransmission fees. Fox is looking for $150 million for the coming year for the 12 stations in play (including local stations such as broadcast home of the NFL and MLB) which is a boost of nearly $80 million over the previous contract.
Skirmishes over retransmission agreements are not out of the ordinary, neither is it unusual for both sides to take their issues public with full page newspaper ads and other PR campaigns. It’s generally rather humorous and transparent finger pointing with deals being signed at the 11th hours. In a world of programmers looking at other-than-cable-delivery options and a decline in cable subs, there’s a lot here to examine.
First off, there are some options for those afflicted in the Tri-State Area (well, at least two states are impacted). For Fox programming, if you can live with the thrill of appointment TV, there’s Hulu, Fox.com and other web distribution partners who provide webcasts of Fox shows as soon as the following day in some cases. If you really want to watch live, thanks to the FCC, we have this handy thing called local digital broadcasts, aka Over the Air. Just point your rabbit ears (metaphorically speaking) at Channel 5 in New York, and you’re good to go. This works for all local stations in your geographic area, topographic issues notwithstanding.
Local OTA protects the NFL and MLB from losing audience in the nation’s top TV market, but can they convince advertisers that viewers will seek out alternative means of viewing to avoid ad drop outs? MLB, which is webcasting its games, also can point New York/New Jersey fans to mlb.tv. If the league is smart, they will drop the premium charge for fans in that area in a show of good will.
If you are to fast forward a month or so, depending on whether Hulu’s content clients give them the green light, disenfranchised Fox viewers could go to their Roku boxes or Sony IP-enabled TVs and go “over the top” to watch Hulu Plus, a premium service that would give them next-day access to Fox programming but instead of watching on their PCs, smartphone or tablets, Hulu Plus becomes a lean-back living-room plasma experience.
This is a topic that demands closer scrutiny, but battle lines in these retrans deals are different than a few years back as today consumers have a growing number of service alternatives…choices that go beyond merely changing TVSPs. In fact, given the issues Dish Network is having with programmers, changing TVSPs may not be a viable option. With options, programmers can hold MSOs and other TVSP’s collective feet to the fire—“pay us or we’ll go direct to consumer.” Even in that scenario, both sides ma not come out ahead as MSOs can rel on their ISP businesses and programmers have to compete in an ever-growing content marketplace. The sports leagues, each of which has been looking at and even experimenting with going over the top, will not stand for service interruptions; in a season of 16 games, one missed broadcast can cost the league dearly. As solutions to bypass cable or satellite becomes easier for average consumers to deploy (Apple TV, Google TV, Roku, Sezmi), cable and satellite providers are feeling the heat.
Despite some short-term inconveniences, consumers stand to be the winners in this fight for eyeballs. More choices, better service, even perhaps more affordable programming packages. Sounds good to me.