Media, message and myth
Scanning the exhibitor list of NAB2002 was a challenging exercise in name recognition. Whatever the show has become, it is no longer an exhibition place for broadcast equipment, but rather a trade show for an amazing cornucopia of media, most of which are unrelated to broadcasting as we know it.
During his opening address, the president and CEO of NAB, Edward (Eddie) O. Fritts, rightly paid tribute to the broadcast media coverage of the tragic events of Sept. 11, 2001. He also told his audience that during that evening the American public turned to broadcast television by a four-to-one margin over cable news networks combined. That may have been so, but it hardly reflects the delivery systems that the audiences used, and it is a reasonable assumption that the majority of viewers were not terrestrial ones.
Mr. Fritts (who calls everybody “friends”) then gave FCC Chairman Powell a minor pat on the back for his voluntary plan to aid the conversion to DTV (more below), and patted NAB on the back for defeating the Torricelli Amendment on Campaign Finance Reform (as in, “give us politicians free television time”).
Then he dissed satellite radio (and its motives), praised iBiquity and IBOC, dissed EchoStar, touched on the Internet opportunities for radio (and the new, ridiculous copyright costs), and offered “an invitation to CBS, FOX and NBC to return to the NAB fold” (as ABC has done).
Then he told us to “go out on that exhibit floor and see our future.” Yes, that was to all those exhibits that bear no relationship to our world of broadcasting — but hey, they're paying for all that floor space, to NAB, of course.
Chairman Powell's timely DTV letter and proposal to the U.S. Senate Committee on Commerce, Science and Transportation and the U.S. House of Representatives' Committee on Energy and Commerce provided a key talking point on the floor.
The Chairman's proposals are entirely voluntary, but I give him kudos for realizing that DTV and HDTV adoption are about content. (Ever heard that before on this page?) He suggests that ABC, CBS, Fox, NBC, HBO and Showtime provide at least 50 percent of their programming with added-value DTV by 2002-2003, added-value being either HD or interactive/multicasting. He then suggests that the delivery vehicles — terrestrial, cable and satellite — pass through such signals to their viewers with cable and DBS carrying at least five such channels during at least 50 percent of prime time.
These are laudable goals but are unlikely to be embraced, regretfully. The networks are the primary stumbling blocks while they remain embattled with their own distribution channels (35 percent ownership rules may be “only one issue” separating them from NAB according to Mr. Fritts, but it is, mostly, one of the only issues for the networks as they gird up for “rationalizing” terrestrial distribution). Cash that they might have is going to be used in the next few years for acquisitions, and turning out expensive add-on value — with advertising revenues diluting continually — pleasing the chairman is not that relevant to them.
On the other side of that same coin, the affiliates are living in fear (those who understand the significance of what is going on — there are also a lot of ostriches out there) and certainly are not going to spend money unless they are forced to by mandate.
With cable and satellite we have a different set of values at work, and this is the best opportunity for the consumer. Whether we continue to have two DBS suppliers or not (and I think that only having one with must-carry rules makes more sense for everybody), there will always be intense competition with cable. Anything that satellite provides cable will have to match, as it will be the other way around, so the chairman's wishes may well be met — provided these suppliers can find sources for the material needed, as it won't be coming from the networks.
While totaling up the revenue from all the NAB non-broadcasting exhibitors, Mr. Fritts was quick to point out that “few things are free anymore with the exception of the public library and over-the-air broadcasting…and we are going to fight to keep it free.”
That really wasn't the future I saw when I was invited out to the exhibit floor to look for it. It's time for the organization to get onto the same page with the reality of a content-driven world instead of concentrating on protecting the delivery system. Instead of protecting the myth.
Paul McGoldrick is a freelance industry consultant based on the West Coast.
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