Cable to New Programmers: "We are the 'Gatekeepers,' so Drop Dead!"

Trade Articles Reveal that Opening for New Channels is as Large as "Eye of the Needle"

 

2 July 2004

As a new national debate emerges over the failure of U. S. television journalism to effectively report on key issues of concern--from the Iraq war to media ownership--it is time to turn our attention to the narrow programming landscape of cable television. Programmers who want to offer Americans with serious news channels, for example, or with services that provide for independent points of view, have no chance of emerging on the multi-channel dial (or the electronic program guide). Two recent cable industry trade magazine articles illustrate why it's time for Congress to "bust-up" the cable cabal that controls much of U.S. Television.

Cable conglomerate Comcast now controls the future of almost all potential new programmers. As CableWorld magazine recently reported, "Comcast has become the …kingmaker, with the power to make or break a digital network. Without a carriage commitment from Comcast, it is difficult for start-ups to raise the investment capital they need." And as the article also makes clear, Comcast is "not looking" to place any new channels on its systems.

According to the article, programmers that may pass Comcast's narrow programming interests have to accept a place on the cable's company new video-on-demand (VOD) system. Comcast has made a strategic decision to expand its VOD offerings, in part as a way to differentiate itself from direct broadcast satellite. So it wants to add VOD content instead of adding what it calls "linear" or full-time channels. That's why it's not surprising that in the article Comcast's Amy Banse, executive VP for programming investments, is quoted as saying that it is "next to impossible, if not impossible" to launch a linear channel these days.

It's also clear from the article that Comcast and the cable industry have made a political and economic decision that more network-like programming isn't necessary. According to Banse: "…with all of us offering 200-plus channels, there's plenty of content out there, and the subscriber simply doesn't want anything else to warrant charging them for that. So between those two facts, it makes it very difficult to launch anything, because it's tough to get eyeballs." Only by agreeing to a VOD distribution agreement with Comcast can an independent programmer hope to reach a significant number of cable households, and only then on terms that are advantageous to the cable operator.

How does Comcast evaluate whether a new service deserves any distribution? One programming executive says they "look at the size and type of the target audience and its attractiveness to advertisers.… Even if it's something that's of interest to a large target audience, that doesn't mean that it will make good television programming. You also look at the other content that's out there that's also serving this niche or audience." For Banse, four "specific criteria" must be met before Comcast will "invest" in and carry a programming service: "It needs to be unique to the channel lineup; it needs to be inexpensive to program; it needs to appeal to a specific demographic; and preferably that's a younger demographic, because it needs to make its money on advertising revenue as opposed to relying heavily on affiliate revenue."

Presumably, since Americans receive such "diverse" news as CNN, Fox, MSNBC, Comcast would claim that the "market" for journalistic content is already covered. Or that because there are two African-American channels (controlled by conglomerates Viacom and Comcast itself), there is no need to ensure independently run services.

It's not Comcast alone that has a "No New Nets" sign. Cox Cable isn't interested in new channels either. That's because "…consumer appetites already have been sated for that kind of programming," according to its senior vice president of programming.

For a country founded on diversity of expression, the opening for new content is an ever-decreasing "eye of the needle," revealed one of cable's leading consultants for new channels in a recent Broadcasting & Cable article.

 

Given the hold that the gang of six media giants has over broadcast, cable, and satellite programming, and the lack of opportunity for real content diversity, it's time to address breaking up the TV oligopoly. If the country is to have a serious independent press and in order to foster a robust culture of ideas, breaking up big cable must be high on the policy agenda.