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Fox Broadcast Fees

chase careyOn December 7, News Corp’s COO Chase Carey said that his company will hold talks with both cable and satellite television operators to negotiate fees to carry FOX television broadcasts.  Carey stated that talks are imminent and that the fees that are charged by some of its affiliates right now are “cheap”.  Huh, cheap.  Does cheap translate into $1,000 or $1 million?  I’m scared to think what cheap is to these telecommunication companies.

News Corp has taken a harder stance in trying to make video distributors pay for retransmitting free-to-air broadcasting networks.  Carey said that, “We need to have a business model that recognizes the value Fox brings to the market place.”   But when asked a specific number, Carey declined to divulge any figures.  He did say that Fox affiliates charge local cable partners about 25 cents per subscriber.  That is dirt cheap but when you figure that each television set in America receives FOX, the 25 cents sure adds up quickly.

Fox isn’t the only provider that is reworking its deals.  CBS has also made retransmission deals a priority.  All the providers feel like there are dollars going out the window and they are probably right.  We want to watch their shows and would probably pay more to do so.  But they have to find a point that is tolerable, otherwise they will lose viewership not because of the show itself, but because the company tried to be greedy.  To quibble of 25 cents is nothing to them, but if viewers’ cable bills shoot up by $5-10, then we will see a real fight on our hands.

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