Channel disputes - Networks vs (all) providers

[Hall]

Many people question who is "at fault" when there's a dispute and channels get dropped. Some providers appear to never get into disputes or rarely do, while others, like Dish, seem to have them more often. My understanding is providers generally pay the same rates - well, it's a good chance that the big providers do while the smaller, local cablecos likely pay a bit more (strictly volume based pricing).

According to this report, http://transition.fcc.gov/Daily_Releases/Daily_Business/2016/db1012/DA-16-1166A1.pdf, from the FCC, the rates charged overall by the networks increased 63% in a single year.

Remember this next time your provider, be it Dish, Directv, TWC, Comcast, etc, etc drop a channel....

 

[sam_gordon]

You can get numbers to read anyway you want. 63% seems like a huge increase, doesn't it? Also in the report... the average cost for retrans per subscriber PER YEAR in 2013 was $24.06. In 2014, it was $36.10. So everyone is complaining about a $12 increase PER YEAR. $1 a month. Hmmm... Dish raises rates $5/month every year, don't they? By the way, I took these numbers from Table 10 on page 16. They also mention the cost difference per subscriber went up 43%. Granted, still a big number, but 63% sounds worse, doesn't it?

 

[ChadT41]

Without reading the article, is that saying that it is going up by $1 per month for all channels or just locals? That can play a huge part, when you consider the increase on ESPN and Disney alone each year.

 

[sam_gordon]

It looks like just locals.

Oh, and the 43% increase I mention is going from $0.747 to $1.069 (avg monthly fee per subscriber per station per month) from 2013 to 2014. So a 32 cent/month increase per station.

 

[dare2be]

It looks like just locals.

Oh, and the 43% increase I mention is going from $0.747 to $1.069 (avg monthly fee per subscriber per station per month) from 2013 to 2014. So a 32 cent/month increase per station.

Yep, that .32 per station per month looks like a small number. Say an average of 10 local stations in a market, and now you're looking at $3.20 increase per month, just for local stations.

What if all the other cable stations wanted that kind of increase? Even just 20 of the most popular stations would bump that increase to over $6.40 per month more, plus the $3.20 for locals, and now you are looking at almost $10 per month annual increases.

Spin all you want. It IS all about the percentages.

I'm glad I'm not paying the locals any of my money currently, or even many of the heavy hitter cable channels.

 

[sam_gordon]

But what if you have 100 local stations in a market? Now you're looking at $32/month.

Again, the average change of retransmission per subscriber (NOT per station) went from $24 to $36. $12 dollar difference for a YEAR for all your locals. Damn greedy broadcasters.

 

[dare2be]

A 50% increase per year IS greedy. If all other channels in the AT200 package wanted a 50% increase, then the package price would go up by probably $25-$30 a month (assuming that subscription fees accounted for $50-$60 of the $80 package price).

Would you balk if your electric rates jumped by 50% in one year, let alone year after year?

 

[mdram]

maybe cable/sat providers should charge stations to be carried and lower our rates that way

 

[ChadT41]

I would love to see Dish say "you can charge whatever you wish, as long as we can offer the channels ala carte " just for everyone to see their true value.

 

[sam_gordon]

A 50% increase per year IS greedy. If all other channels in the AT200 package wanted a 50% increase, then the package price would go up by probably $25-$30 a month (assuming that subscription fees accounted for $50-$60 of the $80 package price).

Would you balk if your electric rates jumped by 50% in one year, let alone year after year?

You like throwing out "if's". If I won the lottery, I wouldn't care what they charged. Would I "balk" if electric rates jumped by 50%? I wouldn't like it, but since electric is something I NEED, I would pay it. I have yet to hear a valid argument on how pay TV is something anyone NEEDs. If something I wanted, but didn't need jumped 50%, I'd decide if it was worth the cost. Seems like a simple policy.

 

[dare2be]

Fine. That's why I'm not feeding the pig and paying for LIL currently. None of the other cable channels are asking for (ok, maybe asking, but not getting) 50% increases. (Which broadcast networks have been pretty much getting since 2006.) In the 10 years from 2006-2016, retrans fees have gone up 38x (that's 3,800%)

 

[sam_gordon]

None of the other cable channels are asking for (ok, maybe asking, but not getting) 50% increases.

If I did my math right, according to the chart you posted, not every year as 50% increase. In fact, 5 years were below 40%, and the difference between 2016 and 2017 is 11%.

Yes, 40% sounds like a big number, but we're talking less than $15/year (based on the quote in the OP where a 46% increase equated to $12/year). Numbers can be deceiving. A store in my town is going out of business. Big signs "Everything 50%, 60%, or 70% off!" are all around. Sounds like a good deal, right? After all, those a big percentages. But they upped the "base" price so something that is 60% off is still more expensive than what you can get down the street.

All I'm saying is numbers can be deceiving.

 

[dare2be]

The overall numbers are not deceiving. From $200 million to $7.7 billion in 10 years. That is more than 120 years of total inflation from 1896 to 2016. $200 million in 1896 is now worth $5.4 billion today.

 

[dare2be]

If I did my math right, according to the chart you posted, not every year as 50% increase. In fact, 5 years were below 40%, and the difference between 2016 and 2017 is 11%.

Ignore the 2016-17 and beyond, those are projections. Real numbers:

2006-2007: 50%
2007-2008: 67%
2008-2009: 60%
2009-2010: 50%
2010-2011: 50%
2011-2012: 33%
2012-2013: 50%
2013-2014: 36%
2014-2015: 31%
2015-2016: 21%

Average annual increase: 44%

 

[DishSubLA]

IMHO, the sky high fees charged by all MVPD's are used to pay for the some of the programming costs so that the package price increases as little as possible, which means the channel package price probably does not reflect the true cost of programming to all MVPD's, otherwise even more people would be "cutting the cord." Those package prices MUST remain as appealing and competitive as possible, so then the MVPD's make up the additional programming costs on those high and ubiquitous fees that make no sense. Every promotion proclaimed in the ads look really good, until they factor in the fees, and then the consumer gets hit with the "real" cost of a promotion.

 

[sam_gordon]

Ignore the 2016-17 and beyond, those are projections.

Actually, I included the 2016-17 numbers because I figured those numbers are pretty much known at this point (we're only two months from 2017).

None of the other cable channels are asking for (ok, maybe asking, but not getting) 50% increases.
...
Average annual increase: 44%

So we've gone from making a big deal about 63% to 50% to 44%. Four of the last five years the increase has been under 40%. If you're going to complain, how about using the correct numbers?

And if paying $12 a year is making that big an impact on your budget, maybe you shouldn't have pay TV to begin with.

 

[dare2be]

So we've gone from making a big deal about 63% to 50% to 44%. Four of the last five years the increase has been under 40%. If you're going to complain, how about using the correct numbers?

And if paying $12 a year is making that big an impact on your budget, maybe you shouldn't have pay TV to begin with.

OMG. More bad assumptions and a complete misunderstanding of the numbers. Numbers are only deceiving to those who don't understand them. I'll try one last time to simplify it for you, then I'm done.

Re-transmission rates on average have more than doubled every two years. Do you understand the power of exponentiation and compounding? If we go by the even numbered years, you have $200M, $500M, $1.2B, $2.4B, $4.9B, $7.7B. If we simply just doubled the $200M 5 times we would only get to $6.4B.

My stance has nothing to do with budgets or affording it. I'm just glad I'm not paying the locals their extortion money anymore.

 

[sam_gordon]

OMG. More bad assumptions and a complete misunderstanding of the numbers. Numbers are only deceiving to those who don't understand them. I'll try one last time to simplify it for you, then I'm done.

Re-transmission rates on average have more than doubled every two years. Do you understand the power of exponentiation and compounding? If we go by the even numbered years, you have $200M, $500M, $1.2B, $2.4B, $4.9B, $7.7B. If we only just doubled the $200M 5 times we would only get to $6.4B.

My stance has nothing to do with budgets or affording it. I'm just glad I'm not paying the locals their extortion money anymore.

Yes, I understand exponentiation and compounding. Do you understand how bad it sounds to say "Can you believe the rates went up 63%?" then "Well it's not 63%, but 50% every year." Then "Well, it's not 50% every year but an average of 44% over the last 10 years." "Well, it hasn't been 44% recently, but it's 35% a year increase over the last 5 years."

But all that being said, the link in the original post shows people are paying $12 per YEAR on average for ALL of their local channels. Whether you agree with it or not, there is a value in local broadcasting. If there wasn't MVPDs wouldn't pay a penny.

 

[dishcomm]

You can get numbers to read anyway you want. 63% seems like a huge increase, doesn't it? Also in the report... the average cost for retrans per subscriber PER YEAR in 2013 was $24.06. In 2014, it was $36.10. So everyone is complaining about a $12 increase PER YEAR. $1 a month. Hmmm... Dish raises rates $5/month every year, don't they? By the way, I took these numbers from Table 10 on page 16. They also mention the cost difference per subscriber went up 43%. Granted, still a big number, but 63% sounds worse, doesn't it?

The last time Dish had a dispute with the company that distributes among other services, CNN. Dish took a stand. CNN et. al demanded a 40% increase in p[er sub rates over the last deal.
Dish countered with "no dice"...CNN's ratings were down 50% over the life of the deal. Dish countered with. and this was published on the Dish webmail CNN is asking for 40% more money for less than half the viewers of 5 years ago"...Eventually, the dispute was resolved. The company, whose name escapes me, decided to take the same amount of money in the previous deal....No increase.

 

[sam_gordon]

The last time Dish had a dispute with the company that distributes among other services, CNN. Dish took a stand. CNN et. al demanded a 40% increase in p[er sub rates over the last deal.
Dish countered with "no dice"...CNN's ratings were down 50% over the life of the deal. Dish countered with. and this was published on the Dish webmail CNN is asking for 40% more money for less than half the viewers of 5 years ago"...Eventually, the dispute was resolved. The company, whose name escapes me, decided to take the same amount of money in the previous deal....No increase.

I'm sorry, I don't understand your point. What you've posted doesn't discount there's value in the product. If there was no value, Dish would pay exactly that... nothing. MVPDs feel they need certain channels in order to be competitive. Does that mean they're willing to pay $25/channel/subscriber? Of course not. Does that mean they're willing to pay $5/subscriber for a local? No. But they are willing to pay whatever they're paying now.