On multicasting diluting TV audiences


Our report on ‘Digital side channels still face hurdles’ 06/10/08 TVBR #113  our observation in part stated, "Why would broadcasters want to dilute the pool even further by cannibalizing their own audience?" Investment media broker Denis LeClair adds his viewpoint to the issue.

I would like to respond to the recent TVBR observation regarding broadcasters cannibalizing their own audience by diluting (multicasting) on their station’s digital tier “Why would broadcasters want to dilute the pool even further by cannibalizing their own audience?”.  

In your comment, you fail to take into consideration that these second tier digital stations can be viewed over-the-air for free by the 15.5 million households (or 14% of TV HHs) that don’t subscribe to cable or satellite.*   Typically a full power DTV station can add six extra channels to simulcast, but by adding just two to three channels, there is no visual degradation of the high definition signal.

The cable industry grew its business off the backs of local broadcasters.  Through this parasitic relationship the cable industry got bigger and was able to offer more and more channels -which in turn, fragmented the audience available to broadcast television.  Broadcasters understand their local market better than any cable company can.  They live it every day. They are well-suited to recognize and fill program voids like:  Hispanic broadcasting, news, 24-hour local weather, family and kid friendly programming, religious programming, local and high school sports, etc. 

One example of a local broadcaster giving the public what they want occurred last year on WBAY-TV in Green Bay.  The station interrupted its normal 24-hour weather sub-channel DTV2-2 to air live gavel-to-gavel coverage of a sensational local murder trial that had the community on the edge of its seat.  This was very appealing to the local residents as evidenced by the amount of local press you can find on the Internet.
Broadcasters have made a considerable investment in their mandated digital future with no guaranteed return on their investment.  Multicasting is a way for them to get back some of the money that they have spent.  This is a pivotal time for the future of television and multicasting is just one of the spokes that will turn the wheel of progress.

(Source: *http://hraunfoss.fcc.gov/edocs_public/attachmatch/DOC-278454A1.pdf)

Denis LeClair, VP/CobbCorp LLC