The price of broadcast rights for professional and college-level sporting events has been skyrocketing, and as a rule, the stratospheric prices are passed on to MVPD subscribers regardless of whether they watch the events or not. But at least one – satellite service DirecTV – is saying prices must be reasonable or there will be no carriage.
At the moment, according to an SNL Kagan Report, DirecTV is balking at carriage of the Pac-12 Netwrok and Comcast SportsNet Houston, unless those services agree to reasonable fees.
The satcaster’s chief content officer Dan York told SNL, “We can’t say yes to everything. The price has to be fair.”
The Comcast channel carries MLB Houston Astros games, which DirecTV points out can be seen on certain other channels and listened to over the radio.
Kagan notes that the DirecTV stance comes on the heels of a Verizon plan to pay certain cable channels by the actual viewer, not the total number of potential viewers.
It would be a good thing for some channels to be paid that way, but others might feel a pinch. Kagan analyst Ian Olgeirson notes that changing pricing in these ways could have an impact on the practice of bundling channels, if even on only an indirect basis.
RBR-TVBR observation: We have always liked the ability to channel surf, but it’s amazing how often one can flip through a hundred channels and find nothing particularly compelling to watch at any given moment. That fact gets even bleaker when you realize you’re actually paying or $60 a year, for some sports channel you watch maybe three times, if that.
MVPDs have long resisted a la carte, and some channel suppliers have joined them, fearing that the loss of the MVPD pier to barnacle on to will cause irrevocable damage.
One the other hand, activist groups have campaigned long and hard for a la carte because they find it abhorrent that part of their subscription fee goes to support channels and programs they detest and find actually harmful.
In the final analysis, though, constantly ratcheting up price tags on certain types of programming – chiefly sports – is going to cause more and more consumers to complain and to demand control of their programming costs. And the louder consumers complain, the more likely becomes congressional intervention.
The ground for intervention has already been fertilized, chiefly by John McCain, who has long called for a la carte and who used to say that you can tell its spring in Washington because the cherry blossoms bloom, tourists begin to appear and cable rates go up.
DirecTV is wise to try to stem the tide, but we’ll be surprised if this doesn’t become a loud and contentious issue in the relatively near future.
We note in conclusion that local broadcast would likely survive such an environment with flying colors. As much as MPVDs like to screech about retransmission consent, local broadcast provides them with a large percentage of their total viewers and almost all of their local content at what is still a bargain price compared to most other MVPD-only channels.