Fox Television Threatens to Go Off the Air
The slow-motion streaming-television revolution continues with a device called Aereo, which allows consumers to stream any local television station already available over their airwaves. This includes what is known as the Big Four: ABC, CBS, NBC and Fox.
After winning a major court battle last week, Aereo has Fox Television so freaked, the network is considering becoming a cable channel, which would mean yanking their broadcast from the public airwaves:
At the National Association of Broadcasters’ annual trade show on Monday, Carey, the News Corp. president, said, “We will continue to aggressively pursue our rights in the courts, as well as pursue all relevant political avenues, and we believe we will prevail.”
Carey added: “One option could be converting the Fox broadcast network to a pay channel, which we would do in collaboration with both our content partners and affiliates.”
That might seem like a counter-intuitive move if you are still under the naïve belief television revenue is all about eyeballs. But that is simply not the case anymore. Television networks and those who own them (like News Corp.) make a fortune from cable television. That is the golden goose these days, not ratings.
Let me explain:
Right now, you and I pay outrageously expensive monthly cable bills because we are forced to pay for dozens of channels we never watch. Even if you never watch MSNBC, you are still subsidizing Rachel Maddow and every other channel in your cable package, because most every network in your cable package receives a monthly fee for every customer forced into a cable package that includes them.
How do you think all these lousy networks manage to stay alive? Trust me, MSNBC is not making a whole lot of money from advertisers with fewer than a million viewers. What keeps junk like Oprah and MSNBC afloat is the monthly fee we involuntarily pay when we are forced to purchase packages that include 200 channels, even though all we really want is Fox News and Turner Classic Movies.
And what keeps many of us from running away screaming from the bundled cable racket is that there is a lot of programming we cannot yet get on the internet: Sports and the latest episodes of Modern Family and NCIS, for example.
Aereo changes much of this. Basically, Aereo removes a major obstacle for anyone desperate to get out from under their cable bill but still hanging on because of American Idol and the Super Bowl.
For $10 a month you get every local channel available over the air (including the networks) along with DVR capability. Add another $7 and you can stream Netflix.
What more do you need?
Though only available in New York City currently, Aereo has thus far won every major court battle against those desperate to hang on to their cable fees and now, according to the Washington Post, plans to expand into Washington, D.C. and 21 other markets this summer.
Even without Aereo, there are five million fewer cable subscribers today than there were in 2007. The population might be increasing, but young people are getting used to watching content online.
Thanks to the wonders of technology, capitalism, and market choices that brought us streaming, the era of the evil known as bundled cable is coming to an end.
Follow John Nolte on Twitter @NolteNC