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Old 04-30-2014, 02:09 PM   #181
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A structure that is generally being abandoned wherever it exists, as fast as the incumbents can make it happen, because it is incompatible with the requirements investors place on for-profit businesses. If that kind of structure is important to the public, then the public will have to pay to build and maintain it itself. This environment won't allow for such substantial unfunded mandates to be imposed on businesses that have to answer to shareholders.
Well I understand that it won't happen, but it's what I think should happen.
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Old 04-30-2014, 02:20 PM   #182
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There are so many more important things that should be imposed on business before making Netflix downloads less expensive for movie-watchers.
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Old 04-30-2014, 02:27 PM   #183
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If the court rules in favor of Aereo, then the cable companies can change their infrastructure to mirror what Aereo is doing and cease all retransmission fee payments. It seems that retransmission fee payments represent approximately 10% of the revenue of a local TV station. This would have some impact on the TV stations, but they could just raise their local advertising rates and the same goes for the networks. There would be some justification for raising the advertising rates, because of the increased viewership from Aereo.

The obvious intent of the law is for the people to be able to watch OTA without paying for the content. The retransmission fee is a perversion that requires people to pay a fee for the content that is supposed to be free.

The supreme court should rule in favor of Aereo, because Aereo is clearly selling an antenna service, a dvr service and a cloud storage service. They aren't selling the content. The local TV stations can adjust their fees to make up for the loss of retransmission fee revenue.
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Old 04-30-2014, 02:35 PM   #184
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He He Ah the power of a good analogy! BTW I prefer the Whopper over the Big Mac. And in spite of your creative analogy, you are wrong about TWC being a monopoly, or even a local monopoly -- although I'm in the same boat and sympathize with you. Quick quiz: which is the most hated company in the USA, TWC or ComCast?
Yes


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Old 04-30-2014, 02:39 PM   #185
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Which should naturally lead to a bifurcated discussion.

It seems unlikely that the SCOTUS would do that. They are often very meticulous about not carelessly bleeding over the edge of the issue brought before them.

Your question's answer is implicit in the error in your premise, as another posted mentioned with regard to Slingbox vs. Aereo: You don't pay TiVo to stream OTA. You pay TiVo for an electronic device, software updates for that device, and program guide data for that device. You do not pay them for streaming OTA. That is precisely what Aereo's subscribers pay Aereo for.

False.

Self-serving claptrap.

Political bloviation (especially inane given most of the SCOTUS was appointed by Republican POTUSs).

More evasion of reality: You don't like the law as it pertains to retransmission, so you refuse to allow yourself to understand what the law is. Ridiculous.

False analogy. The precedents make clear that (in your scenario) satellite is a yet another burger.

Precisely.

I still have analog cable and don't have to use any cable company provided equipment, so for me satellite is not a burger.

And if I want a burger (cable), my choices are TWC, TWC, or TWC.
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Old 04-30-2014, 03:10 PM   #186
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It seems that retransmission fee payments represent approximately 10% of the revenue of a local TV station.
I couldn't find any current info about the profit margins for local television stations, but Derek Baine, a senior analyst at SNL Kagan, said a good year for a broadcast network is a 10 percent profit margin, and I bet most local television stations have thinner margins than the big networks - especially the local television stations in generally under-served areas, i.e., those areas likely to be harmed most by failure of significant numbers of local channels.

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This would have some impact on the TV stations, but they could just raise their local advertising rates and the same goes for the networks.
That's not true. Television advertising pricing is not infinitely elastic, as you suggest.

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The obvious intent of the law is for the people to be able to watch OTA without paying for the content.
The obvious intent of what law?

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The retransmission fee is a perversion that requires people to pay a fee for the content that is supposed to be free.
The law is what sets forth the basis for retransmission fees. These two sentences combine to make me question whether you know enough about this topic to comment on it.
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Old 04-30-2014, 03:12 PM   #187
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I still have analog cable and don't have to use any cable company provided equipment
That may not be the case much longer.

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so for me satellite is not a burger.
It still is, even if you don't like it.
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Old 04-30-2014, 03:37 PM   #188
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I personally believe that what Aereo is doing is a "retransmission" based upon how that term has been adjudicated in the past (Dish Network setting up antennas to capture local channels is retransmission, Slingbox is not retransmission).

"Retransmission" will never be legally defined, any more than "pornography" or "fair" or "anti-competitive" can be defined. These are terms that require interpretation and that is why we have a federal court system: to interpret the law.

In this particular case, I believe the Court has no choice but to rule against Aereo. To allow Aereo's model to survive would totally up end broadcasting in this country. If the law was compellingly in support of Aereo it would be different, but Aereo has gone right up to the line, and I think everyone would agree on that, no matter which side of the line you believe they stand upon. So the court is going to be forced to decide the issue on technicalities. If they rule against Aereo, they may destroy the business of a relatively small startup. If they rule for Aereo they may destroy broadcast television as we know it. If you were on the court, presented with that choice, which would you choose?

Why? It allows people to receive the "over the airwaves that belong to the public" broadcasts which they are legally entitled to receive, just with the antenna a little farther from the house.

(and Aereo subscribers, just like people with rabbit ears, can't be lured away from the broadcast offerings by whatever's on HBO or TNT or whatever, they're locked in to just the local broadcasts.)

If broadcasters cannot survive just on ad revenue, perhaps they should surrender their licenses and let local governments run the stations as local events billboards with lots of PSAs and the occasional emergency announcement as necessary.

If broadcasters cannot survive just on ad revenue, maybe their programming which they think is so popular that they can increase the fees they get from cable subscribers by threatening to withhold it isn't as popular after all.

If broadcasters cannot survive just on ad revenue, no one is obligated to help them stay in business.
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Old 04-30-2014, 03:40 PM   #189
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If the court rules in favor of Aereo, then the cable companies can change their infrastructure to mirror what Aereo is doing and cease all retransmission fee payments. It seems that retransmission fee payments represent approximately 10% of the revenue of a local TV station. This would have some impact on the TV stations, but they could just raise their local advertising rates and the same goes for the networks. There would be some justification for raising the advertising rates, because of the increased viewership from Aereo...
I'm afraid not...the broadcasters have turned to retransmission consent fees to help slow the LOSS of revenue from traditional advertising. Advertisers don't spend as much money on broadcast commercials as they used to, diverting those dollars to cable and internet advertising. I have personal knowledge of at least one major network's ad rates and they have, on average, not kept up with the rate of inflation being nearly flat for the past 5 years. Many broadcasters in smaller markets (and some larger ones too) are still in debt from the cost of digital conversion and upgrades for HD. Broadcasting is not the money making machine that some seem to think it is.
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Old 04-30-2014, 03:41 PM   #190
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That may not be the case much longer.

It still is, even if you don't like it.
SOMETHING WHICH IS NOT CABLE IS NOT CABLE!!!

and my cable choice is TWC or no cable.
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Old 04-30-2014, 03:43 PM   #191
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Why? It allows people to receive the "over the airwaves that belong to the public" broadcasts which they are legally entitled to receive, just with the antenna a little farther from the house.
Because the signal is retransmitted. If Aereo simply strung a wire from their antennas to the subscribers' homes, then you'd be correct; there would be no problem.

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If broadcasters cannot survive just on ad revenue, perhaps they should surrender their licenses and let local governments run the stations as local events billboards with lots of PSAs and the occasional emergency announcement as necessary.
Most people would prefer to foster broadcast OTA service as it is today, even with the retransmission fees and other means of raising revenue to pay operating costs - anything to avoid it becoming an encumbrance on the public taxpayer.

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If broadcasters cannot survive just on ad revenue, no one is obligated to help them stay in business.
And if Aereo cannot survive if subject to retransmission fees, then no one is obligated to help Aereo to stay in business either.

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SOMETHING WHICH IS NOT CABLE IS NOT CABLE!!!
Stop shouting. Read the law. Learn what "multi-channel video programming distributor" means. Shouting isn't going to suddenly make the realities you don't like go away.
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Old 04-30-2014, 04:19 PM   #192
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Why? It allows people to receive the "over the airwaves that belong to the public" broadcasts which they are legally entitled to receive, just with the antenna a little farther from the house...
And involving a 3rd party (Aereo) that is neither the viewing public, nor the broadcaster, and who is making money by delivering the content without permission.

That's why...and that is my opinion, just as your contrary position is your opinion. We look at the same facts and come to different conclusions. Which is why this case is in front of the Supreme Court.

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...(and Aereo subscribers, just like people with rabbit ears, can't be lured away from the broadcast offerings by whatever's on HBO or TNT or whatever, they're locked in to just the local broadcasts.)...
Except for whatever they have available on their Roku, Apple TV, XBox, Playstation, etc. No one is "locked into" anything.

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...If broadcasters cannot survive just on ad revenue, perhaps they should surrender their licenses and let local governments run the stations as local events billboards with lots of PSAs and the occasional emergency announcement as necessary...
Be careful what you wish for...if Aereo prevails in court, you may indeed see hundreds of TV stations surrender their licenses. Of course, it is VERY unlikely that the government would take them over...they would just go dark.

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...If broadcasters cannot survive just on ad revenue, maybe their programming which they think is so popular that they can increase the fees they get from cable subscribers by threatening to withhold it isn't as popular after all...
If broadcast TV were not so popular, Aereo wouldn't be able to make a business out of delivering it to people.

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...If broadcasters cannot survive just on ad revenue, no one is obligated to help them stay in business.
Obligated? No. But like it or not, the federal government has been propping up and protecting broadcast TV for decades, and this case is not going to change that. Congress sees broadcast TV as a leveling device...it ensures that viewers in the smallest town in America has access to same information and entertainment content as a viewer in the largest metropolis. Not mention that it is also the best way for them to get political advertising to the voter.
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Old 04-30-2014, 04:46 PM   #193
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Be careful what you wish for...if Aereo prevails in court, you may indeed see hundreds of TV stations surrender their licenses. Of course, it is VERY unlikely that the government would take them over...they would just go dark.
What is more likely is simply substantially more and more time will be turned over to shop-at-home services.

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If broadcast TV were not so popular, Aereo wouldn't be able to make a business out of delivering it to people.
It does seem that every bit of logic that people post to support Aereo's position post can be just as readily use to discredit Aereo's position.
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Old 04-30-2014, 05:51 PM   #194
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So, retransmission fees are (claimed to be) necessary to keep TV stations in business. Thus in effect people who have cable or satellite services are paying so people who only have antennas can see broadcast network programming (from CBS, NBC, etc), which is the major benefit, plus have the benefit of local news, emergency announcements (and political ads ).

It has been stated that congress wants it that way, and that must be true (or it wouldn't be that way). It has also been stated that this is popular with the public. I question that. Given the penetration of cable and satellite in the TV market, I wonder what a poll would show if you included in the question the fact that cable and satellite subscribers are paying several dollars a month in retransmission fees. But never mind, Congress makes the laws and they sometimes ignore popular opinion, for both valid (e.g., constitutional) and invalid (e.g., rewarding special interest contributors) reasons.
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Old 04-30-2014, 07:09 PM   #195
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...It does seem that every bit of logic that people post to support Aereo's position post can be just as readily use to discredit Aereo's position.
Yes...different people look at the same information and draw different conclusions - the very definition of why this case ended up in court.
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Old 04-30-2014, 07:19 PM   #196
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So, retransmission fees are (claimed to be) necessary to keep TV stations in business. Thus in effect people who have cable or satellite services are paying so people who only have antennas can see broadcast network programming (from CBS, NBC, etc), which is the major benefit, plus have the benefit of local news, emergency announcements (and political ads ).

It has been stated that congress wants it that way, and that must be true (or it wouldn't be that way). It has also been stated that this is popular with the public. I question that. Given the penetration of cable and satellite in the TV market, I wonder what a poll would show if you included in the question the fact that cable and satellite subscribers are paying several dollars a month in retransmission fees. But never mind, Congress makes the laws and they sometimes ignore popular opinion, for both valid (e.g., constitutional) and invalid (e.g., rewarding special interest contributors) reasons.
I doubt very many people ever give copyright law, retransmission consent fees or how much broadcast locals add to their cable bill a moment's thought. The amount that retrans fees add to your cable or satellite bill is pretty small...from under a dollar in some small markets to a few dollars in really large markets. In as much as one cable channel (I'm looking at you ESPN) costs more than all the locals combined, I also doubt many people would look to their locals as a way to economize.

Picking up on a comment made earlier in the thread...

As long as we're talking about how broadcasters should be able to live without retrans fees, I question whether or not paying retrans fees would cripple Aereo. While the cable companies hate the concept of Aereo (since it encourages more cord-cutting) the broadcasters don't mind, as long as they get paid and Aereo doesn't eliminate retrans fees completely. So, if Aereo were required to pay the same rates cable providers do, the monthly fee would rise from $8 to perhaps $10. Is that going to destroy their viability in the market? I doubt it.
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Old 04-30-2014, 07:31 PM   #197
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It has been stated that congress wants it that way, and that must be true (or it wouldn't be that way). It has also been stated that this is popular with the public. I question that. Given the penetration of cable and satellite in the TV market, I wonder what a poll would show if you included in the question the fact that cable and satellite subscribers are paying several dollars a month in retransmission fees. But never mind, Congress makes the laws and they sometimes ignore popular opinion, for both valid (e.g., constitutional) and invalid (e.g., rewarding special interest contributors) reasons.
If cable were allowed carry the network programming directly, bypassing the locals, I suspect they would jump at the chance to do so. It would certainly be cheaper for them to take one national feed than all those locals. But would that be in line with Congress' view of "public interest"? Probably not. Would it be in line with the public's view of their own interest? Perhaps if it brought their cable bill down, but there is no guarantee it would do that. Since congress can't hold spectrum licenses over the head of cable to force local coverage, how you or I get notice of an approaching Tsunami or Tornado in that world without Local Broadcast TV?

As with most messes, it got this way organically. Something better will need to come along before it is likely to change.
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Old 04-30-2014, 07:57 PM   #198
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I doubt very many people ever give copyright law, retransmission consent fees or how much broadcast locals add to their cable bill a moment's thought.
If that's true, I don't see how it could be true that:
Quote:
Most people would prefer to foster broadcast OTA service as it is today, even with the retransmission fees and other means of raising revenue to pay operating costs - anything to avoid it becoming an encumbrance on the public taxpayer.
(Quoted from bicker's post #191)
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The amount that retrans fees add to your cable or satellite bill is pretty small...from under a dollar in some small markets to a few dollars in really large markets. In as much as one cable channel (I'm looking at you ESPN) costs more than all the locals combined, I also doubt many people would look to their locals as a way to economize.
Here is an interesting recent article from the Milwaukee Business Journal:
http://www.bizjournals.com/milwaukee....html?page=all
Note the retrans cost mentioned is $2.25 and Milwaukee is a relatively small market, and TWC stated this is only a portion of the total retrans fees.

Interesting quote from this:
Quote:
Retransmission fees skyrocketed from $215 million in 2006 to more than $3 billion in 2013, and are projected to eclipse $6 billion in 2018, according to research Time Warner Cable cited from media researcher SNL Kagan.
I don't see any perspective in which this can be seen as anything other than far outpacing any related statistic such as subscriber counts or revenues.

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Picking up on a comment made earlier in the thread...

As long as we're talking about how broadcasters should be able to live without retrans fees, I question whether or not paying retrans fees would cripple Aereo. While the cable companies hate the concept of Aereo (since it encourages more cord-cutting) the broadcasters don't mind, as long as they get paid and Aereo doesn't eliminate retrans fees completely. So, if Aereo were required to pay the same rates cable providers do, the monthly fee would rise from $8 to perhaps $10. Is that going to destroy their viability in the market? I doubt it.
But (since they are hostile to Aereo) wouldn't the broadcasters hold them up for much higher fees just to kill them?
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Old 04-30-2014, 09:40 PM   #199
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You can say this a million times and it STILL doesn't make it fact. It doesn't mean diddly-squat. It's not clear, courts have ruled both ways, and the SCOTUS will make the final ruling. And unless Congress decides to pass new laws relating to this, the SCOTUS decision will stand for a significant period of time.

You see, in this country, we let the courts interpret the law. We don't let people like Bigg decide, in their emphatic and declamatory manner, that their interpretation of the law IS the law. We reserve that right for the courts.

I need to unsubscribe. I enjoy a spirited debate, with give & take. I can't stomach despots.
The law is clear in what it says. The problem is that the conclusion that the law comes to is completely insane, because the law itself is completely insane in the first place. Because the technical distinction of one antenna vs. many has no practical implication, it makes the actual meaning of the law hard to stomach, but it is what it is. And it does say that what Aereo is doing is completely legal.

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Political bloviation (especially inane given most of the SCOTUS was appointed by Republican POTUSs).
Well, it's true. The administration's position is awful on this. I'm less and less enthusiastic about the Obama administration as time goes on. He's not a real liberal.

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More evasion of reality: You don't like the law as it pertains to retransmission, so you refuse to allow yourself to understand what the law is. Ridiculous.
I understand what it says. Anyone who puts ANY thought whatsoever into it will realize that the law, as written, makes no sense. You have to look at the background of where this crazy differentiation between antennas comes from, and realizing that the law makes no sense in the first place explains why the end result (a warehouse of tiny antennas) ends up becoming some sort of bizarre satire on how nuts the law is in the first place.
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Old 04-30-2014, 10:03 PM   #200
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And involving a 3rd party (Aereo) that is neither the viewing public, nor the broadcaster, and who is making money by delivering the content without permission.

That's why...and that is my opinion, just as your contrary position is your opinion. We look at the same facts and come to different conclusions. Which is why this case is in front of the Supreme Court.



Except for whatever they have available on their Roku, Apple TV, XBox, Playstation, etc. No one is "locked into" anything.



Be careful what you wish for...if Aereo prevails in court, you may indeed see hundreds of TV stations surrender their licenses. Of course, it is VERY unlikely that the government would take them over...they would just go dark.



If broadcast TV were not so popular, Aereo wouldn't be able to make a business out of delivering it to people.



Obligated? No. But like it or not, the federal government has been propping up and protecting broadcast TV for decades, and this case is not going to change that. Congress sees broadcast TV as a leveling device...it ensures that viewers in the smallest town in America has access to same information and entertainment content as a viewer in the largest metropolis. Not mention that it is also the best way for them to get political advertising to the voter.
That makes no sense.

Aereo subscribers are people who don't want to, or don't want to pay to, get TV from cable or satellite (except for getting some of it over cable modem internet), but for whatever reason have a problem with receiving OTA via an antenna at their viewing location--they're in an RF "shadow", they're too near large reflecting structures that create unsurmountable multi-path problems, they're in structures other than stand alone houses which means they can't put up an outside antenna-they just don't want to hassle with putting up an outside antenna, whatever.

These are viewers the broadcasters would not have if not for Aereo.

They aren't time-shifting or commercial avoiding any more than people with antennas who have DVRs in their houses, but broadcasters don't seem to be in a hurry to get rid of viewers who pluck their signal out of the air with all the receiving equipment in that one location (if they are, then they no longer need an FCC broadcast license).

If the court rules in Aereo's favor, they'll be saying that Aereo is different from cable when it comes to "re-transmission", or that the legal definition of "re-transmission" is such that it applies to cable but not Aereo, so a ruling in Aereo's favor will not result in cable being able to get out of paying re-transmission fees to the broadcasters.

In other words, a ruling in Aereo's favor does nothing to reduce the amount of money the broadcasters are currently getting, it just keeps them from getting even more.

Of course if the court rules against Aereo and the retrans fees are such that it destroys Aereo's business model, then the broadcasters will have just thrown away viewers, so they should be careful for what they wish.

Remember, Aereo takes the signal out of the air at no additional operating cost to the broadcaster who has to put it there anyway.
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Old 04-30-2014, 10:09 PM   #201
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I read somewhere recently that local broadcasters are forced to kick back some of the retrans money they get to whichever network it is with which they are affiliated.

Everywhere you turn these days, rentseekers.
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Old 04-30-2014, 11:23 PM   #202
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Originally Posted by unitron View Post
That makes no sense.

Aereo subscribers are people who don't want to, or don't want to pay to, get TV from cable or satellite (except for getting some of it over cable modem internet), but for whatever reason have a problem with receiving OTA via an antenna at their viewing location--they're in an RF "shadow", they're too near large reflecting structures that create unsurmountable multi-path problems, they're in structures other than stand alone houses which means they can't put up an outside antenna-they just don't want to hassle with putting up an outside antenna, whatever.

These are viewers the broadcasters would not have if not for Aereo.

They aren't time-shifting or commercial avoiding any more than people with antennas who have DVRs in their houses, but broadcasters don't seem to be in a hurry to get rid of viewers who pluck their signal out of the air with all the receiving equipment in that one location (if they are, then they no longer need an FCC broadcast license).

If the court rules in Aereo's favor, they'll be saying that Aereo is different from cable when it comes to "re-transmission", or that the legal definition of "re-transmission" is such that it applies to cable but not Aereo, so a ruling in Aereo's favor will not result in cable being able to get out of paying re-transmission fees to the broadcasters.

In other words, a ruling in Aereo's favor does nothing to reduce the amount of money the broadcasters are currently getting, it just keeps them from getting even more.

Of course if the court rules against Aereo and the retrans fees are such that it destroys Aereo's business model, then the broadcasters will have just thrown away viewers, so they should be careful for what they wish.

Remember, Aereo takes the signal out of the air at no additional operating cost to the broadcaster who has to put it there anyway.
The networks don't want to have any more loss of control of their public free signal than they have to. Technology does make some older laws hard to understand and interpret hence the SC, if people on this Thread could not argue so passionately on both sides of this the case, this case would have never made it to the SC.
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Old 05-01-2014, 05:52 AM   #203
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If that's true, I don't see how it could be true that:
Because so many people are so pathologically hateful toward taxes that even ignorant of the other aspects of the issue, they will choose the option that doesn't have taxpayers paying the cost of operating television stations.

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Originally Posted by Bigg View Post
Well, it's true. The administration's position is awful on this. I'm less and less enthusiastic about the Obama administration as time goes on. He's not a real liberal.
IMHO, that's a good thing. A balancing of both sides, liberal in the interest of human decency and conservative with regard to non-essential things like ESPN and HBO.

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I understand what it says.
We'll have to agree to disagree about that.
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Old 05-01-2014, 08:25 AM   #204
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Originally Posted by unitron View Post

That makes no sense.

Aereo subscribers are people who don't want to, or don't want to pay to, get TV from cable or satellite (except for getting some of it over cable modem internet), but for whatever reason have a problem with receiving OTA via an antenna at their viewing location--they're in an RF "shadow", they're too near large reflecting structures that create unsurmountable multi-path problems, they're in structures other than stand alone houses which means they can't put up an outside antenna-they just don't want to hassle with putting up an outside antenna, whatever.

These are viewers the broadcasters would not have if not for Aereo.

They aren't time-shifting or commercial avoiding any more than people with antennas who have DVRs in their houses, but broadcasters don't seem to be in a hurry to get rid of viewers who pluck their signal out of the air with all the receiving equipment in that one location (if they are, then they no longer need an FCC broadcast license).

If the court rules in Aereo's favor, they'll be saying that Aereo is different from cable when it comes to "re-transmission", or that the legal definition of "re-transmission" is such that it applies to cable but not Aereo, so a ruling in Aereo's favor will not result in cable being able to get out of paying re-transmission fees to the broadcasters.

In other words, a ruling in Aereo's favor does nothing to reduce the amount of money the broadcasters are currently getting, it just keeps them from getting even more.

Of course if the court rules against Aereo and the retrans fees are such that it destroys Aereo's business model, then the broadcasters will have just thrown away viewers, so they should be careful for what they wish.

Remember, Aereo takes the signal out of the air at no additional operating cost to the broadcaster who has to put it there anyway.
If Aereo wins all the cable companies would need to do is setup a similar system and then they could avoid retransmission fees altogether.
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Old 05-01-2014, 09:52 AM   #205
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The broadcasters are NOT hostile towards Aereo...they are terrified by it's business model. If the court holds that Aereo is not reqired to pay retransmission fees, then EVERY cable and satellite system in the country will adopt the same approach. I don't see how the court can hold that Aereo is doing something different than cable except by citing the mechanics of what they are doing. That would make cable and satellite eligible to do the same and also avoid the fees. This will completely eliminate a revenue stream that the stations and networks have come to depend upon.

If, on the other hand, Aereo is found to be subject to retransmission fees then the broadcasters would embrace Aereo as a way to extend their market. Therefore, there is no reason to expect that the fees charged Aereo will exceed those paid by cable and satellite operators (indeed, they might even be less).

Whatever opinion one may have about the logic or equity of the law, retransmission fees are the result of, among other things, DVRs. There were discussions on boards just like this one, back in the late 1990's about how DVRs would erode advertising rates and that broadcasters would find some way to make up the difference. Product placements and retransmission fees were a couple of the ways they developed. You can consider retransmission fees as part of the cost of skipping commercials.

This is the fundamental concept that gets lost in most discussions on this subject. OTA broadcasts are NOT free. Inherent in the OTA model is a "contract" between the broadcaster and the government (IOW, the station's license) that grants to the broadcaster the right to use a given set of frequencies, and to insert advertising into their broadcasts to pay for the cost of operations and content development. The amount of money the station charges advertisers is directly tied to the number of viewers that actually see the advertisement. Advertisers have, for the past several years, been discounting a program's ratings by the percentage of viewers with DVRs. In 2008 only about a quarter of households had DVRs while today almost half do. Add in people watching via Netflix and Amazon, and to lesser extent Hulu, and suddenly even immensely popular shows don't bring in the advertising revenue that mediocre success did 10 years ago. That missing revenue has to come from somewhere, since it isn't getting any cheaper to run a TV station.

Since the model where advertising paid for broadcast TV is no longer working, the only way to keep broadcasting alive was to find a different model. Just like any cable channel, the cable and satellite operators have to pay to carry the channel. That is the new business model. Forget about the "public airwaves" arguments - they are irrelevant. Forget about the fact that the broadcasts are unencrypted and free to recieve - also irrelevant. There is no such thing as "free TV" - either advertisers pay for it, or you do (or, more commonly, a bit of both).
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Old 05-01-2014, 10:20 AM   #206
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Because so many people are so pathologically hateful toward taxes that even ignorant of the other aspects of the issue, they will choose the option that doesn't have taxpayers paying the cost of operating television stations.
........
Not sure that applies to a discussion of retrans fees (which technically are not taxes), but responding to the statement per se:

So many people are hateful toward taxes because they know there are so many people, roughly 50% of federal income tax payers, who pay no net federal income tax at all, and thus are prone to favor increased spending (and thus increased debt and/or taxes) even ignorant of the other aspects of the issue -- since there is no cost to them.
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Old 05-01-2014, 10:44 AM   #207
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Originally Posted by Diana Collins View Post
The broadcasters are NOT hostile towards Aereo...they are terrified by it's business model. If the court holds that Aereo is not reqired to pay retransmission fees, then EVERY cable and satellite system in the country will adopt the same approach. I don't see how the court can hold that Aereo is doing something different than cable except by citing the mechanics of what they are doing. That would make cable and satellite eligible to do the same and also avoid the fees. This will completely eliminate a revenue stream that the stations and networks have come to depend upon.

If, on the other hand, Aereo is found to be subject to retransmission fees then the broadcasters would embrace Aereo as a way to extend their market. Therefore, there is no reason to expect that the fees charged Aereo will exceed those paid by cable and satellite operators (indeed, they might even be less).
I hope you're right but the broadcasters would know they have Aereo over a barrel and that kind of power tends to drive fees up -- just because they "need" the money and they can do it.
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Originally Posted by Diana Collins View Post
Whatever opinion one may have about the logic or equity of the law, retransmission fees are the result of, among other things, DVRs. There were discussions on boards just like this one, back in the late 1990's about how DVRs would erode advertising rates and that broadcasters would find some way to make up the difference. Product placements and retransmission fees were a couple of the ways they developed. You can consider retransmission fees as part of the cost of skipping commercials.

This is the fundamental concept that gets lost in most discussions on this subject. OTA broadcasts are NOT free. Inherent in the OTA model is a "contract" between the broadcaster and the government (IOW, the station's license) that grants to the broadcaster the right to use a given set of frequencies, and to insert advertising into their broadcasts to pay for the cost of operations and content development. The amount of money the station charges advertisers is directly tied to the number of viewers that actually see the advertisement. Advertisers have, for the past several years, been discounting a program's ratings by the percentage of viewers with DVRs. In 2008 only about a quarter of households had DVRs while today almost half do. Add in people watching via Netflix and Amazon, and to lesser extent Hulu, and suddenly even immensely popular shows don't bring in the advertising revenue that mediocre success did 10 years ago. That missing revenue has to come from somewhere, since it isn't getting any cheaper to run a TV station.

Since the model where advertising paid for broadcast TV is no longer working, the only way to keep broadcasting alive was to find a different model. Just like any cable channel, the cable and satellite operators have to pay to carry the channel. That is the new business model. Forget about the "public airwaves" arguments - they are irrelevant. Forget about the fact that the broadcasts are unencrypted and free to recieve - also irrelevant. There is no such thing as "free TV" - either advertisers pay for it, or you do (or, more commonly, a bit of both).
Even if one accepts the validity of this concept, consider this quote from an earlier post of mine:
Quote:
Retransmission fees skyrocketed from $215 million in 2006 to more than $3 billion in 2013, and are projected to eclipse $6 billion in 2018, according to research Time Warner Cable cited from media researcher SNL Kagan.
With this kind of exponential growth of fees, the business model is going to collapse of its own weight. We're going to have to find a new way to accomplish the public benefits of broadcast TV stations, instead of one that amounts to massive transfer payments from cable and satellite subscribers to antenna watchers.
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Old 05-01-2014, 11:25 AM   #208
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I hope you're right but the broadcasters would know they have Aereo over a barrel and that kind of power tends to drive fees up -- just because they "need" the money and they can do it...
They have cable and satellite over the same barrel. The fees charged Aereo will very likely be commensurate with those charged to Time Warner Cable or any other operator.

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...With this kind of exponential growth of fees, the business model is going to collapse of its own weight. We're going to have to find a new way to accomplish the public benefits of broadcast TV stations, instead of one that amounts to massive transfer payments from cable and satellite subscribers to antenna watchers.
I don't argue with what you're saying, but I think there is a LOT of elasticity still in the market. Even if the sum of retransmission fees reached $10 per subscriber (about 4 times or more what they average today) I don't think the model will collapse. The truth is we don't know at what price we hit the ceiling for TV entertainment. Prices have risen, across the board, quite steadily year after year. When you see what ESPN and regional sports networks are pulling in, and consider how much sports coverage (particularly pro football) is on OTA broadcast TV, I think the ceiling for retransmission consent fees is still quite a ways off.
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Old 05-01-2014, 12:52 PM   #209
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With this kind of exponential growth of fees, the business model is going to collapse of its own weight.
There's no reason to believe that: ESPN charges cable companies $24.4B per year - that's one channel that charges eight times as much as all the local channels combined. And there are dozens and dozens of cable channels that charge fees to multi-channel video programming distributors. The retransmission fees aren't going to break the multi-channel video programming distributors' business model.
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Old 05-01-2014, 07:09 PM   #210
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That makes no sense.
Wow, good catch. I missed the part about the OTA stations "going dark". First of all, they are not just going to shut down and lose millions and millions and millions of dollars as some sort of political stunt. Second of all, if for some reason they feel threatened by Aereo itself, which is a ridiculous concept, they would take a more graceful path to moving the higher value content off to affiliated cable channels, and then backfilling with low-value syndicated content that they can still make money on with an OTA distribution system. They are not just going to go dark overnight. That's crazy fear mongering talk. The networks might threaten that, but it's ultimately a (mostly) empty threat. The real threat is an increase in the pace of moving content to cable, which is already happening.

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IMHO, that's a good thing. A balancing of both sides, liberal in the interest of human decency and conservative with regard to non-essential things like ESPN and HBO.
The problem is, there is no truly liberal national platform or politicians, outside of a couple of representatives, but that's another story...
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