Fox v. Time Warner coming to a head


The deadline on the game of chicken between Fox Television and Time Warner Cable is looming, and is likely a precursor of similar battles to come between other big networks and big cable operators, with local television affiliates owned by third party companies possibly caught in the middle.

Fox is threatening to pull its stations off of Time Warner systems if its retransmission demands for its own O&O local broadcast stations are not met.

Both parties are appealing to consumers with advertisements, as if they are locked in a political campaign.

Fox is believed to be asking for about $1 per subscriber – said to be about what the going rate is for basic cable’s TNT Network, a price it commands with a much smaller viewer base – and is far below the top drawer fee commanded by ESPN, which is said to be around $4 per sub.

The New York Times reports that Fox is also interested in sharing in retransmission fees collected by its local affiliates, and notes that CBS for one is actively supporting Fox as both an owner and operator of television stations and owner and operator of a network.

RBR-TVBR observation: If basic cable networks are worth dual income streams, from advertising and subscriptions, then it only makes sense that local broadcast television stations are as well – and it is only fair that such stations be paid commensurately with the number of viewers they pull in to the MVPD.

Perhaps underperforming cable networks should expect to be paid commensurately with their total viewers – and if that means a reduction in price, that would help defray the costs of the broadcast programming that cable subscribers actually tune into.