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In Perspective: Snarter

Mon, 09/16/2013 - 3:25pm
Brian Santo

“Reverse retrans” might merit some consideration   

The Time Warner Cable / CBS dispute merely underlines what everyone knows: the retransmission consent process is utterly out of control. Some policy wonks are suggesting the solution is to eliminate retrans rules altogether.

But for all the aggravation retrans consent has caused for MVPDs, MVPDs might learn to love retrans – if it were turned around.

Facilities-based MVPDs have always been incensed that they are obligated to carry Netflix and other over the top (OTT) providers on their broadband networks for free.

The MVPD response to the threat was savvy: convince their programming partners to deliver their content overthe- top only to authenticated MVPD subscribers.

This may have been a setback for OTT rivals, but they have proved resourceful too. They’ve been buying the rights to valuable libraries and began to finance their own shows. Netflix has deals with Disney, DreamWorks, and recently the Weinstein Co., and for its original programming just earned 14(!) Emmy nominations.

Now Viacom is rumored to have sold rights to several of its premium channels to Sony for some future OTT service. Google execs were in the company of NFL executives when broadcast rights to NFL games were discussed. ESPN president John Skipper was quoted saying ESPN is willing to entertain offers from any distributor willing to negotiate rights for its entire sports package at the current or higher price.

Does that mean the whole TV model is set to crumble tomorrow? No, and probably not next month or next year, either.

But if we’re seeing cracks now, it is just a matter of time before companies like Sony, Apple, and Google become virtual MVPDs, taking advantage of facilities-based MVPDs for free.

And that’s why it would be a very good idea for cable and other facilities-based MVPDs to consider advocating for transmission consent, in which virtual MVPDs pay a fair fee for something they would want: managed carriage. The proposal has been made before with OTT companies and failed, but what if the argument was reintroduced within the context of retransmission consent, as an issue of fairness and consumer benefit? Yes, transmission and retransmission are distinct processes, which will increase the difficulty of making the argument, but it ought to be considered. A possible consequence of failing to do so might be that Google puts the NFL on YouTube, and facilities-based MVPDs end up literally carrying the games, but for someone else, and not seeing a dime for it.

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