As more and more quality video content becomes available online, some consumers are finding that it can be combined with an old-fashioned television antenna to receive local broadcast programming off-air and kiss big cable bills good-bye. According to the Wall Street Journal, rabbit ears are starting to hop off the shelves. And it calls into question how many TV broadcasters will be willing to hop off the airwaves.
WSJ notes that the average price of a cable subscription, if it includes ISP service, is within speaking distance of $100 per month, without adding high definition or premium programming services to the ticket.
Many consumers are discovering that they can simply pick up their local broadcast stations off air, subscribe to a service like Netflix and use the growing universe of internet program services for other content. This combination can often be had for half of the price cable companies charge.
At the moment, WSJ is calling the phenomenon an “unexpected revival” of local off-the-air (or OTA) television. But one St. Louis-based antenna company isn’t complaining. Antenna Direct has gone from 400K sales in 2010, to 600K in 2011 and expects to easily eclipse 1M sales this year in doubling its 2011 sales total.
The situation throws into question the entire plan to auction television spectrum to repurpose for mobile broadband. If more consumers are going to once again rely on local television that comes over the airwaves rather than over a wire, the size of the pool of broadcasters willing to relinquish it in exchange for a one-time payday and an permanent exit from the business is questionable.
NAB’s Dennis Wharton told WSJ, “It’s not a stretch to think that the broadcast business model will outlive that of cable. The naysayers can talk all they want about broadcasting being a dinosaur.”
RBR-TVBR observation: It is extremely difficult to pass technical legislation under the best of conditions; with today’s polarized legislature it’s incredibly difficult. Even under the best of circumstances legislation is usually based on a snapshot of a fluid process that includes complex market and technical facets. Against that backdrop, Congress just voted to authorize incentive TV spectrum auctions. But how they will actually play out is still a mystery. Stay tuned!
