Deborah D. Mcadams /
02.12.2013 02:07 PM
Cable Rates, Another View
Not so black and white

Not so fast missy, a small cable operator said to me about my column in the Jan. 16 issue. I said I was dropping cable because it’s stuffed with content I never watch. I flamed the carrier for perpetuating a business model predicated on bloated programming tiers, when a la carte can be had for the price of a Mini DisplayPort cable. I said the argument for retransmission reform was a lobbying diversion so cable companies could keep sticking it to customers for shows they don’t watch.

I noted that I live in a market with 110,000 cable households, which may have implied the carrier was a small business. It is not. It’s one of the largest in the country. Costs are significantly different for a company with 15 million subscribers versus one with fewer than 3,000.

The operator who called was in the latter category. He said he was paying $27 in programming fees for the $53 package on his cable system—more than half versus roughly one-third on average, based on publically available figures.

Retrans is one thing. His negotiation with an independently owned TV station in an adjacent large market went well, he said. It’s the other tactics attached to retrans by broadcast-cable conglomerates. Carriage of their local broadcast signals is tied to placement of multiple, additional, minimally viewed networks. Either he carries those or pays a substantially higher price for the local broadcast signal.

Another maneuver is for a network to demand payment for 50 percent of subscribers, even if they’re on a new digital tier used by just 6 percent of subscribers.

He would like to be able to negotiate for individual networks without having to pay a premium for the primary.

“Retransmission consent reform is crucial to the survival of many small systems,” he said.

I stand corrected.

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