from the fueling-the-fire dept
We’ve for some time written about cable TV programming blackouts stemming from contract disputes over retransmission fees. The way this works is that cable operators pay broadcasters of television channels fees to retransmit those broadcasts to customers. When those contracts come to term, broadcasters often demand rate-hikes, which the cable operator resists. In the event no agreement is reached, one side or the other blacks out the channel, pissing off fans of that channel. That anger is then leveraged by both sides to negotiate better terms. Pay TV customers, meanwhile, never see any kind of refund for the missing channel.
In the pantheon of reasons that cord-cutting continues to be a trend, blackouts may not rank as the highest of reasons, but it might be one of the easiest to understand, irritating examples of how the cable TV business simply isn’t serving its customers all that well. Blackout instances have been trending upward for years, but as Karl just discussed 2019 is already a record-breaking year for blackouts, and we’re only a bit over half way through the year.
Broadcast TV stations are being blacked out on cable and satellite TV systems in record numbers this year, with 230 blackouts so far in 2019. That beats the record of 213 blackouts set in 2017, even though 2019 is just seven months old. The 230 figure represents a huge rise over the eight blackouts seen in 2010 and 42 in 2011, according to a pay-TV industry advocacy group.
Blackouts has mostly been trending up in the past decade, though the number frequently goes down one year before rising again the next. There were 90 blackouts in 2012, 119 in 2013, 94 in 2014, 193 in 2015, 104 in 2016, 213 in 2017, and 165 in 2018.
Both sides are, as per usual, scrambling to blame the other side. What nobody is really speaking to, however, is why consumers should bother putting up with any of this. With tons of options for professional and amateur content on the internet, much of which is on par with anything offered through pay TV channels, and without the entanglements that lead to these blackouts, why should the public stick around to see the end of these blackouts at all?
Many of them aren’t, of course. They’re cutting cords faster than a new father in the delivery room. Any battle cable providers want to wage against that trend is going to be hampered by these blackout squabbles, as customers see less and less value in the service for which they pay. And it’s not as though blackouts are the only thing reducing the value-per-dollar equation for customers.
AT&T and other TV providers have complained for years about rising programming costs in general, not just for broadcast stations. One counter-strategy TV providers have used is to buy large programmers, like AT&T did with Time Warner in a deal finalized last year. But that doesn’t stop the AT&T-owned Time Warner from charging high prices for its content, and the industry consolidation hasn’t prevented TV users from being charged ever-higher prices.
AT&T claimed that its Time Warner merger would lower prices for consumers, but AT&T has since been raising them instead. AT&T is also starting to pull Time Warner shows off Netflix in order to make them exclusive to an upcoming service it calls HBO Max.
There’s a lot in the world about which to be confused, but why the public is cutting the cord in the face of these lies and greed is not one of them.