Disputes between cable networks (or their parent companies) and the distribution companies that carry them are nothing new. It seems like we see at least a half-dozen channel blackouts happen every year, when the contract negotiations between the two break down.
But the New York Post, based on one of the most recent fights, has a theory: if this continues we might just see more than one set of negotiations break down. We might actually see the entire system go.
The provider in this case is actually a consortium of small providers, the National Cable TV Cooperative (NCTC). Together, the NCTC represents about four million subscribers — a drop in the hat as compared to the more than 20 million Comcast boasts, or even the 6 million you’d find at Cox. The network they’re fighting with is AMC, currently of The Walking Dead (and formerly of Mad Men and Breaking Bad) fame.
The story is the same as ever: AMC wants more money than NCTC is willing to pay, and talks between the two have come to a stalemate. The network may very shortly go dark for those four million subscribers, but instead of trying to embarrass AMC into a lower rate, NCTC is basically shrugging, and telling their subscribers that their favorite AMC programming, when it returns in February, will be available on Hulu, iTunes, and other digital services.
The two are, at least still talking. Rich Fickle, the head of NCTC, told the Post that AMC is due for some kind of rate increase — just not one as large as they’re asking for. “The bundle was great for many years, but it’s under pressure and that’s what’s at stake,” he told the Post. “We’re hitting an inflection point. We’re a leading indicator, the thread on the sweater.”
AMC, for what it’s worth, released a statement saying, “We have extraordinarily high regard for the NCTC and for its members. We have long supported smaller cable operators, and the particular challenges and considerations that they face in the service of their markets. We will continue to endeavor to do everything we can to make them successful.”
Fickle, though, might have a point. The smallest cable companies, with the least margin for error money-wise, have been on the forefront embracing cord-cutters for a while now. Back in 2014, a few of them simply dropped TV altogether, and their subscribers, on the whole, neither minded nor cared. The Post theorizes that going forward, this trend could well see an uptick among the smaller providers and from there, snowball into the larger companies as well.
That scenario sounds somewhat apocalyptic to the content networks, and probably not desirable to the distribution companies either. But even though it is somewhat plausible, it is almost certainly premature at this point. Even though investors are kind of starting to freak out about the demise of forty years’ worth of cable TV arrangements, cable isn’t dead yet.
Pay TV has been seeing a consistent decline in subscriber numbers every quarter for the past few years, but there are still nearly 100 million households paying a cable or satellite company to bring programming to their homes. It will be years yet before the Comcasts, Dishes, and Charters of the world actually keel over, let alone rise again to shamble menacingly along.
How a threat to drop AMC could kill the cable bundle [New York Post]
by Kate Cox via Consumerist