In late January the Federal Communications Commission announced a proposal allowing cable and satellite subscribers to pick the devices they use to watch programming. Nearly all customers now must get their boxes from their cable companies, and they pay an average of $231 a year to lease the devices, which has led to many subscribers looking for alternative sources for television.
The game changing move could have major impact on the industry, allowing Google, Amazon and Apple to expand their footprints in the media industry with devices that would blend Internet and cable programming in a way the television industry has resisted. The initial reactions to the FCC announcement was exactly what we expected. The technology industry widely cheered the proposal, while the cable industry did their best “In Living Color – Men on Film” impression and “Hated It!”
TV One Chief Executive Alfred Liggins was in opposition of the change stating, “Distributors will be forced to reconsider what they pay for programs that can be siphoned off, repackaged and resold, drying up the revenue needed to underwrite quality shows. These arrangements — including critical terms such as channel placement, advertising, scheduling and more — are the lifeblood of the video marketplace today.” If you didn’t know, TV One is currently in about 57 million homes and continues to help sustain the Radio One brand.
The original founder of BET, Robert L. Johnson had a different take on it and opposed his good friend, Alfred regarding the universal set-top box.
“As the founder of Black Entertainment Television (BET), I know how difficult it was to get distribution over cable. But with the support of the cable industry and the African American community, I and others, turned bet into the success it is today.
The universal set-top box, unlike the leased cable box, opens up the unfettered opportunity for hundreds of minority programming aspirants who would like to create content success of their own, similar to what I enjoyed with bet. With all due respect to my good friends Alfred Liggins, Founder and CEO of TV One, and Michael Powell, CEO of the National Cable and Telecommunications Association (NCTA), it is not the Federal Communications Commission’s (FCC) role or obligation to force Black Americans who have a median net worth of $13,000 to spend an average of $231 a year to lease a cable box so TV One and the cable industry can make billions of dollars off of working class Black Americans, to only have access to four Black-oriented channels out of over 500 choices that principally show network reruns.
There is nothing in the FCC’s proposed rule making that would allow technology companies to infringe on TV One’s advertising revenue and relationships. On the other hand, my company, RLJ Entertainment (NASDAQ: RLJE), is well on the way to proving that programmers do not have to be totally dependent on advertising models. RLJE operates two over-the-top (OTT) subscription streaming channels, both of which depend on direct subscriber revenue.
Acorn TV, which produces countless hours of original British mysteries and dramas, and UMC – Urban Movie Channel, through its parent company RLJ Entertainment, acquires more minority and independent films than any minority programmer on cable. And by the way, we have licensed content to both TV One and bet. UMC, as a minority targeted program channel, is a perfect example of the opportunity that hundreds of other minority programmers will have when the universal set-top box is implemented and their content is given equal access to the subscriber on any viewing device, particularly the television set.
Finally, the FCC should not protect minority incumbents, but should encourage new minority entrants, and that is what the universal set-top box does. Most minority programmers I know, unlike TV One, are not asking the FCC to protect them from competition but are simply seeking an opportunity for a fair chance and a fair shot to have their content seen and their voices heard!”
In the end we know both gentleman are trying to do what is best for their companies. We will watch to see how this unfolds. As for me, I know I”m tired of paying for cable. Sheesh!