Cable Rates, Another View
Not so black and white
February 12, 2013
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
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.