Rate Adjustments and Retransmission Consent ... a detailed explanation.
Ever Wonder About the Fees That Make Up Your Monthly Local TV Bill?
Because we’re a hometown business, we are invested in our community, our employees and our customers. With Network fees dramatically increasing and impacting your monthly bill, we wanted to give you a backstage pass to better understand the economics of the TV business.
What are Programming Fees?
All TV providers whether cable or satellite pay each Programmer a fee for every household that receives a particular Network – regardless of whether anyone in the household actually watches it.
These Network fees have increased dramatically at 3½ times the rate of inflation over the last 15 years. (1)
Only FIVE media companies control 90% of the Networks, and while we work hard to keep these costs under control, they continue to use their power to demand more money. (2)
Programmers are securing long-term contracts with significant guaranteed Network fee increases, regardless of how many people watch.
So, why do Channel Lineups include channels that you don’t watch?
Many customers would prefer to pay for only the most popular Networks and a select group of quality, special-interest ones that appeal to them. This is something that MTC would like to offer, but most Networks will not allow this. Unfortunately, the powerful Programmers often have the upper hand in how we can package their Networks, and in the additional Networks that they force you to pay for.
Why does this happen?
It’s a matter of power: just five multi-billion-dollar corporations own or control about 90% of existing TV networks.(1)
These five companies own most of the networks you want, as well as many of those you don’t. And they won’t let you have the most-popular networks unless you get the less-popular ones, too. It’s simple economics: they need more viewers for these less-popular networks to increase their subscriber fees and their advertising fees – so that they make more money.
The average household watches only about 16 channels regularly, but when Programmers package their Networks together, it creates an inflated group of four or more times that amount.
We strive to offer our customers a strong basic Cable TV package with the most popular Networks as well as those that they request the most. A solid basic TV video package provides your family a significant value over the options that most streaming providers offer. In many streaming plans, you’ll often pay for shows by the episode or season, and costs can quickly escalate when all the shows each family member watches are factored in.
Skyrocketing Sports TV Rights: It’s Not a Game, It’s Big Business.
It’s a fact: the steeply rising price of TV sports rights has doubled the basic TV bill of TV providers over the past decade.(1) And that’s not just for sports fans, but for everyone.
Why are Sports Networks charging so much?
The leagues are demanding higher and higher fees for broadcasting rights from Networks, in turn forcing them to charge higher rates to TV Providers – which in turn increases the TV customers’ bills.
Originally, most games were free. Then ESPN came along and carried games from all leagues for a fee. Now, many leagues, conferences and teams, including college sports, have their own Networks – each with its own high fee, yet offering little or no additional games.
Conferences and Regional Sports Networks account for a fast-growing portion of every TV provider’s monthly bill, and it’s happening in both small towns and big cities.
(1) SNL Kagan (2) Ben Bagdikian, The Media Monopoly
Information in this post was obtained from TV On My Side www.tvonmyside.com
