The American Television Alliance (ATVA), funded by the biggest pay-TV providers in America, is crying foul regarding rising monthly customer bills and is calling on the Federal Communications Commission (FCC) to take action to address rising retransmission consent fees paid to TV broadcasters.
Will the FCC, the top federal regulator of the pay-TV industry, actually consider changing its “good faith” rules for retransmission consent to favor multi-billion dollar cable and satellite TV giants?
The fact of the matter is that the retransmission consent system is working, with hundreds of deals reached each year without programming disruptions. It’s a phony claim by ATVA and big pay-TV companies that doesn’t tell the whole story about why pay-TV subscribes’ bills keep rising.
The American Customer Satisfaction Index again found that five ATVA members – Mediacom, Time Warner, Suddenlink Communications, Charter Communications and Bright House Networks – finished at or near the bottom of customer satisfaction rankings in 2015. Indeed, these titans of pay television collectively finished dead last in the rankings with every other business sector in America, including the banking industry, airlines and supermarket chains.
Poor customer service and annoying call center experiences top the list for reasons why customers despise their pay-TV service. These problems are further manifested by the reasons why pay-TV subscribers call customer service in the first place due to poor service quality and annual price hikes at three times the rate of inflation.
The facts regarding programming costs speak loud and clear. It costs pay-TV customers six times more to access less-watched cable network channels and three times more to rent one DVR than it does to receive the full complement of local broadcast TV channels as part of a monthly subscription.
The majority of Americans are not concerned with the $5 “Broadcast TV Fee” they pay each month; they’re more concerned with network service outages, early-termination fees, monthly DVR rental fees, lousy customer service and pure pay-TV greed. And don’t think Congress isn’t paying attention.
In a July 2015 letter to the Federal Communication Commission (FCC) Sens. Bernie Sanders (I-Vt.), Al Franken (D-Minn.), Elizabeth Warren (D-Mass.) and Ed Markey (D-Mass.) asked the FCC to investigate rising pay-TV and broadband prices paid by tens of millions of Americans. Hopefully, the Commission will act.
Maybe the federal inquiry could start with how pay-TV companies lock customers into two-year contracts with lower first-year “promotional rates” and then, subsequently, jack up prices as much as $50 or $60 per month in the second year. All of that’s in the fine print, of course, and requires a magnifying glass to read.
It’s exceedingly curious why the FCC seems obsessed with a part of pay-TV pricing that most consumers care little about: local broadcast TV fees. Indeed, if policymakers really want to help consumers, the focus should be what really matters: abominable service, high set-top box and DVR rental fees, and outrageously high early-termination fees that prevent customers from switching providers.
Kenny is director of Public Affairs for TVfreedom.org, a coalition of local broadcasters, community advocates, network TV affiliate associations and other independent organizations advocating for preserving the retransmission consent regime. He is a former press secretary at the FCC.
