Why We Should Care About Retrans: Conclusion
This is the fourth installment in a series on TV retransmission fees. Previous installments focused on introducing the series, PR and television audiences, and regulation. In brief Disney, WABC's parent company demanded a per-subscriber retransmission fee from New York area cable provider, Cablevision. Cablevision thought the fee was too much. A messy public battle ensued and WABC disappeared from Cablevision at midnight on Sunday, March 7, night before the Oscars. If you want to learn more about retrans in general, check out this great article from Broadcasting & Cable.
The latest public battles over retransmission consent are a clear indication that television business models are becoming increasingly unstable. Retrans has always been an easy way for national networks to get things they want--like carriage for their cable stations, but until recently, retransmission fees were not part of national networks' business models for owned and operated (O&O) local stations. So, what's changed? Business models are up in the air because of digital distribution, network culture, and new players--like Google--entering the TV market. This is scary and some bad things could happen:
- Hulu, cord cutters, and piracy will ruin the TV industry.
- The economy and declining ad revenues will ruin the TV industry.
- The ratings industry's failure to measure digital audiences will ruin the TV industry.
This is all to say that networks know they're leaving money on the digital table, as it were. While they're scrambling to adapt their business models, it's easy to grab some low hanging fruit and collect a few extra million in retransmission fees.