The next round of retransmission consent negotiations between television broadcasters and cable companies is just a few months away. And after seeing the fees charged for off-air stations skyrocket the last time around, small cable operators are preparing for the worst. Might one option to simply say "no" and stop carrying off-air stations?
At first, it seems absurd to think of a cable service without the broadcast networks. After all, many cable systems began as "community antenna systems" whose only content was received off-air. Only after the launch of HBO and superstations such as WTBS and WGN in the 1970's were satellite signals added to the mix. But if not during this retransmission consent round, dropping broadcast signals entirely could become a serious option in another three years.
One reason is the fact that more and more off-air stations are being offered on OTT platforms. For example, Sony has negotiated a deal with CBS and its affiliates that means customers in many TV markets, including the Des Moines and Cedar Rapids/Waterloo DMA's, can now see their local CBS affiliate through the Playstation Vue platform. The other major OTT platforms, or vMVPD's (for virtual multichannel video program distributors), including Sling TV, YouTube TV, DIRECTV Now, and others, are also working on securing rights to stream local network affiliates to their customers. By the time we get to this fall and start negotiations with the TV stations, several more platforms and additional markets may have been launched.
Dropping the broadcast networks from your cable system is likely to be too painful to consider for now. But the time has come to reconsider the common practice of carrying duplicate network affiliates. When those signals were free it made sense to have multiple CBS, NBC, ABC, and FOX affiliates on your system. Now is the time to talk to customers about dropping any duplicate affiliates you have. And for those operators in small, rural markets where you might have a choice between stations from two or more DMA's, it's a good idea to find out from customers which stations they want you to keep-and which ones they could live without.
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June 16, 2021
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