Danger recently pointed out that the feud between DirecTV and The Weather Channel has gone well beyond the usual squabbling between two corporate entities and entered the realm of comedy. But, believe it or not, this is something you should actually pay close attention to, because it’s going to affect your cable bill in ways you might not expect.
I’m too lazy to click links. What’s this about?
What it’s always about, money. Specifically, retransmission fees; the Weather Channel wants DirecTV to pay more for the privilege of broadcasting the Weather Channel. DirecTV has chosen the “Eat It, We’ll Use Another Channel” option. Both of them are currently posturing like this is the Cuban Missile Crisis.
So why should I care?
Because this isn’t just another channel dispute. The Weather Channel is owned by NBCUniversal, which is a wholly owned subsidary of Comcast. It’s also one of the biggest networks in Comcast’s stable, with almost 90% of households able to watch weather on the eights. In other words, what would normally be a minor pissing match is going to probably be the first shots fired in a massive war.
Satellite and cable companies are competitors, obviously, but increasingly, it’s becoming clear that what was once a big juicy pie that everybody could share is shrinking, and fast. Cable providers can no longer laugh off cord-cutters; an industry that once never reported a loss of subscribers is suddenly finding itself with subscriber losses that, while small, are not only happening every quarter, but are starting to accelerate. And satellite providers are stagnating, which is why Dish really wants to become, among other things, a mobile carrier.
So how’s this going to play out?
One of two ways. The first is that this spills over into a massive spite war: It’s not out of the realm of possibility Comcast is going to try and make DirecTV pay by either suddenly charging a lot more for its other channels, or just taking its ball and going home, meaning Syfy, E!, and Bravo, among others, just vanish off DirecTV’s channel options. The second is that Comcast backs down and accepts the same rate it had before, or a cheaper but still higher rate.
The problem for both sides is that this will set a precedent that others will refer to; so if Comcast caves, when it goes to renegotiate with other providers, notably satellite companies, it’ll have to accept a reduced rate there. It doesn’t help that, as many have noted, it’s pretty easy to find weather information anywhere online. Similarly, DirecTV really can’t afford to raise rates and has no reason to back down. So this will deepen animosities, and perhaps even encourage satellite companies to start poaching cable customers.
Either way, though, this is going to set the tone for a lot of blackouts to come, and there are going to be more and more blackouts. New York City has already seen blackouts of CBS and Fox in the last few years, and as retransmission fees go up and price pressure comes to bear on cable networks, it’s really only a matter of time before you’re constantly trying to figure out which of the channels you don’t watch are blacked out. Aren’t oligopolies fun?
(Image courtesy of rb3m on Flickr.)