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Fox News To Seek Higher Carriage Fees

Considering the most of the current carriage fees were set before FNC started dominating the cable news ratings, an adjustment is in order. It's all about the law of supply and demand. There is a lot of demand for Fox News Channel.
 
Great, another increase to my cable bill......

I hope channels that decrease in popularity actually get a reduction in Carriage fees to offset.
 
Bengalsfan said:
Considering the most of the current carriage fees were set before FNC started dominating the cable news ratings, an adjustment is in order. It's all about the law of supply and demand. There is a lot of demand for Fox News Channel.

That would be fine, if that cable channels (ESPN, Fox News and the rest) didn't force cable and satellite operators to pay fees for all subscribers - whether or not they ever watch a given channel. And those fees are reflected in everybody's cable bills. I know Fox News groupies don't want the government ever to fix anything, but the FCC needs to force a la carte pricing.
 
Thats foolish. I can get the same news headlines from MSNBC or CNN.

As for ESPN's price their a sports network. Its expensive to televise all the sporting events.
 
For ESPN I would say its expensive to buy the rights to all the different sports. The televising bit is probably pretty cheap at this point.
 
Ken said:
Thats foolish. I can get the same news headlines from MSNBC or CNN.

...with less Republican dogma.

When Fox News does ask the cable companies for more dough, I hope they have the guts to say "No Deal". Unlike most other channels, this is one channel I don't mind being blacked out for nonpayment.
 
2009 monthly carriage fees (per each subscriber) for selected networks....

ESPN $4.08
Fox Sports $2.37
TNT $.99
Fox News $.58
ESPN2 $.54
USA $.55
CNN/HLN $.51
TBS $.49
Nick at Nite $.44
CNBC $.29
TCM $.26
A&E $.25
History $.22
ABC Family $.22
--INDUSTRY AVERAGE $.20 --
Cartoon $.17
MSNBC $.16
 
MattParker said:
That would be fine, if that cable channels (ESPN, Fox News and the rest) didn't force cable and satellite operators to pay fees for all subscribers - whether or not they ever watch a given channel. And those fees are reflected in everybody's cable bills. I know Fox News groupies don't want the government ever to fix anything, but the FCC needs to force a la carte pricing.

The FCC is helping out enough, thank you. Be careful what you ask for - you might get it. If you think cable is expensive now, wait 'til the government gets even further involved, adding the cost of enforcing the pricing model. Myself, I don't care to see government spending any more of my money to regulate a luxury item. If people don't like the pricing structure, they can drop cable. Most people don't need it and cannot justify spending everybody's money on it. Those who can't get consistent OTA reception can subscribe to lifeline cable, which doesn't have ESPN or Fox News, or MSNBC, or any other of the universe of cable channels, and so, aren't paying for it anyway. Or how about a good old-fashioned boycott? There are a lot of other options that don't require more government outlay of resources for other people's luxuries.
 
I like Fox News...but if my cable bill gets any higher, I'm just going to go back to OTA and watch the new cable shows online. Just isn't worth it!
 
MattParker said:
2009 monthly carriage fees (per each subscriber) for selected networks....

ESPN $4.08
Fox Sports $2.37
TNT $.99
Fox News $.58
ESPN2 $.54
USA $.55
CNN/HLN $.51
TBS $.49
Nick at Nite $.44
CNBC $.29
TCM $.26
A&E $.25
History $.22
ABC Family $.22
--INDUSTRY AVERAGE $.20 --
Cartoon $.17
MSNBC $.16

Fox News is already getting 58 cents per subscriber? I think personally that's enough. I don't like the channel personally, but my views aren't based on that.

Fox News is more expensive than USA, and I'd argue that USA has more programming costs (and viewers) than Fox News. I'm surprised TNT is getting as much as they are.

ESPN is getting way out of control with carriage fees. I realize they have to pay for the NFL, but so do ABC, Fox, and NBC and you don't see them charging those ridiculous fees. And Fox Sports? Wow, $2 for 6 hours of paid programming a day. Brilliant.

At some point with these carriage fees SOMETHING has to break. We can't continue to see cable rates go up faster than inflation and not expect people to leave in droves. I have a special promo package right now, but when that's up, I will definitely be re-evaluating my options personally. With taxes, basic cable is already approaching $70 per month where I live (and to add the digital package is another $20 now).
 
mnradiofan said:
MattParker said:
2009 monthly carriage fees (per each subscriber) for selected networks....

ESPN $4.08
Fox Sports $2.37
TNT $.99
Fox News $.58
ESPN2 $.54
USA $.55
CNN/HLN $.51
TBS $.49
Nick at Nite $.44
CNBC $.29
TCM $.26
A&E $.25
History $.22
ABC Family $.22
--INDUSTRY AVERAGE $.20 --
Cartoon $.17
MSNBC $.16

Fox News is already getting 58 cents per subscriber? I think personally that's enough. I don't like the channel personally, but my views aren't based on that.

Fox News is more expensive than USA, and I'd argue that USA has more programming costs (and viewers) than Fox News. I'm surprised TNT is getting as much as they are.

ESPN is getting way out of control with carriage fees. I realize they have to pay for the NFL, but so do ABC, Fox, and NBC and you don't see them charging those ridiculous fees. And Fox Sports? Wow, $2 for 6 hours of paid programming a day. Brilliant.

At some point with these carriage fees SOMETHING has to break. We can't continue to see cable rates go up faster than inflation and not expect people to leave in droves. I have a special promo package right now, but when that's up, I will definitely be re-evaluating my options personally. With taxes, basic cable is already approaching $70 per month where I live (and to add the digital package is another $20 now).

Who are you to determine what you think is enough? If FOX (News Corp.) is getting $2.37 per subscriber for Fox Sports (which is totally absurd, BTW), and the market supports that, then FNC is almost certainly being undervalued from their point of view. A 24-hour news channel is expensive to run, but likewise FNC has been a resounding success story for News Corporation. The average time spent watching is through the roof and they typically get more viewers than CNN and MSNBC combined. The people who watch that channel find it important and tend to be very loyal to it. That's a key point because that particular channel (much like ESPN) literally attracts subscribers and if your system doesn't have it, they know that they'll lose lots of subs. There are some channels that people like, others that people take for granted and many that they couldn't care less about. Then there are the channels that people feel strongly about. Fox News is in this latter category and the ratings show it. In fact, a more in-depth study of their ratings gives them even more justification for such a move.

Look, let's leave the politics out of this. There's too much lefty hate going on in the thread and not enough logic. If MSNBC had runaway success and wanted to jack up their carriage rates, I wouldn't have an issue with it. As to whether YOU like USA network better or not is immaterial. If NBC Universal felt that they could ask more for that channel, they would. Perhaps Comcast will do so in the future if it seems like they could get away with it. It's all about supply and demand at this point.

Where I do agree with many posters is that - in theory - it would be nice if we had some sort of an a la carte system in place. Again, in theory, this would be the "fairest" system. However, in practice it never seems to work because not enough people will pay for most channels to allow them to survive. And, if you go channel-by-channel, your costs are inevitably higher. This is why even the satellite providers offer packages. Yes, there is a lot more flexibility with the dish than with cable - but even the dish isn't totally a la carte.
 
BRNout said:
mnradiofan said:
MattParker said:
2009 monthly carriage fees (per each subscriber) for selected networks....

ESPN $4.08
Fox Sports $2.37
TNT $.99
Fox News $.58
ESPN2 $.54
USA $.55
CNN/HLN $.51
TBS $.49
Nick at Nite $.44
CNBC $.29
TCM $.26
A&E $.25
History $.22
ABC Family $.22
--INDUSTRY AVERAGE $.20 --
Cartoon $.17
MSNBC $.16

Fox News is already getting 58 cents per subscriber? I think personally that's enough. I don't like the channel personally, but my views aren't based on that.

Fox News is more expensive than USA, and I'd argue that USA has more programming costs (and viewers) than Fox News. I'm surprised TNT is getting as much as they are.

ESPN is getting way out of control with carriage fees. I realize they have to pay for the NFL, but so do ABC, Fox, and NBC and you don't see them charging those ridiculous fees. And Fox Sports? Wow, $2 for 6 hours of paid programming a day. Brilliant.

At some point with these carriage fees SOMETHING has to break. We can't continue to see cable rates go up faster than inflation and not expect people to leave in droves. I have a special promo package right now, but when that's up, I will definitely be re-evaluating my options personally. With taxes, basic cable is already approaching $70 per month where I live (and to add the digital package is another $20 now).

Who are you to determine what you think is enough? If FOX (News Corp.) is getting $2.37 per subscriber for Fox Sports (which is totally absurd, BTW), and the market supports that, then FNC is almost certainly being undervalued from their point of view. A 24-hour news channel is expensive to run, but likewise FNC has been a resounding success story for News Corporation. The average time spent watching is through the roof and they typically get more viewers than CNN and MSNBC combined. The people who watch that channel find it important and tend to be very loyal to it. That's a key point because that particular channel (much like ESPN) literally attracts subscribers and if your system doesn't have it, they know that they'll lose lots of subs. There are some channels that people like, others that people take for granted and many that they couldn't care less about. Then there are the channels that people feel strongly about. Fox News is in this latter category and the ratings show it. In fact, a more in-depth study of their ratings gives them even more justification for such a move.

Look, let's leave the politics out of this. There's too much lefty hate going on in the thread and not enough logic. If MSNBC had runaway success and wanted to jack up their carriage rates, I wouldn't have an issue with it. As to whether YOU like USA network better or not is immaterial. If NBC Universal felt that they could ask more for that channel, they would. Perhaps Comcast will do so in the future if it seems like they could get away with it. It's all about supply and demand at this point.

Where I do agree with many posters is that - in theory - it would be nice if we had some sort of an a la carte system in place. Again, in theory, this would be the "fairest" system. However, in practice it never seems to work because not enough people will pay for most channels to allow them to survive. And, if you go channel-by-channel, your costs are inevitably higher. This is why even the satellite providers offer packages. Yes, there is a lot more flexibility with the dish than with cable - but even the dish isn't totally a la carte.

It's NOT up to me to assign value, like everyone else, I'm giving my opinion. And I'm not basing my opinion on politics. I'm not a leftist or a rightist, I land somewhere in the middle. For the record, I don't care for CNN or MSNBC either. But, when you're comparing prices, its hard to justify Fox News getting anywhere NEAR what ESPN or even Fox Sports get (also two channels I don't watch, yet pay for).

What I'm arguing is that it certainly costs USA (another network I don't watch much, actually) more in rights and production fees than it costs someone like Fox News. The argument that a network is popular and therefore deserves more carriage fees is itself absurd. If a network gets high ratings, then said network should be able to charge more for advertising. Comparing based soley on popularity, I can get CNN and HLN for less than I can get Fox News currently. Not only that, but USA, TNT, TBS, and Nick all have higher ratings than Fox News yet charge significantly less.

Personally, I am leaving politics out of it. It's not because of the politics that I dislike Fox News, but rather the fact that it can even call itself a "news" station yet be so opinionated. I have that same issue with the rest of the so-called "news" networks as well. I'm happy that Fox News exists, and that we have a choice between three news networks, but I do wish we had more straight forward "news" that could educate the masses and let them decide how THEY felt, instead of manipulating people into feeling a certain way.
 
mnradiofan said:
It's NOT up to me to assign value, like everyone else, I'm giving my opinion. And I'm not basing my opinion on politics. I'm not a leftist or a rightist, I land somewhere in the middle. For the record, I don't care for CNN or MSNBC either. But, when you're comparing prices, its hard to justify Fox News getting anywhere NEAR what ESPN or even Fox Sports get (also two channels I don't watch, yet pay for).

What I'm arguing is that it certainly costs USA (another network I don't watch much, actually) more in rights and production fees than it costs someone like Fox News. The argument that a network is popular and therefore deserves more carriage fees is itself absurd. If a network gets high ratings, then said network should be able to charge more for advertising. Comparing based soley on popularity, I can get CNN and HLN for less than I can get Fox News currently. Not only that, but USA, TNT, TBS, and Nick all have higher ratings than Fox News yet charge significantly less.

I am sorry, but your post belies a lack of understanding when it comes to how the marketplace works. For one thing, how can you possibly say that Fox News doesn't 'deserve' nearly what Fox Sports gets? Personally, I am amazed that FSN gets as much as it does with so many second-tier and lower sporting events that few care to watch. The only reason that they're picked up by some systems is that FOX negotiates a package deal and if you want the local FOX O&O, FOX News and other channels then you have to eat FSN.

As far as value and demand goes, Fox News is worth far more to any carrier and is in more demand than FSN ever will be. Also nonsense is the comment that FSN has higher costs than FOX News. Do you have any idea how expensive a 24/7 national news operation is to run? Their costs are MANY times higher than FSN's. As an aside, the way that Comcast gets screwed for providing FSN is probably why they have the FOX Movie Channel relegated to the sports tier. And why I don't get to see it.

Lastly, although USA and the others you mentioned tend to peak with higher ratings than any news channel, the viewership patterns are inconsistent. Again, your perception of costs is skewed because it's far cheaper to air reruns and select dramas produced by your corporate parent (as USA and TNT do) than it is to run a news network like FOX News. It's not even close. Eluding to the start of this paragraph, if your cable outlet dropped FNC, they would lose a LOT of subscribers. Just as they would if they dropped ESPN. If they dumped USA, TNT, etc., they'd lose some but not nearly as many.

This is a market-driven decision. FOX News has their market to themselves. The people who like that channel will demand that channel from their provider. Admittedly, losing a channel like TNT, TBS, USA, etc. would be bad for a service provider. But the economics of such channels is different than the economics of an ESPN or FOX News. They usually come as part of a much larger package and - once again - are much cheaper to operate.

If CNN or MSNBC had FNC's viewership numbers, they'd be trying to get more per subscriber too. FNC has the same things going for it that ESPN does. Also, let's not forget that they are bundling FOX Business Channel in the deal.

As for your comment about selling ads, that's actually a different issue - which is only partially related. This is about payment for carriage and not ad sales. There's a difference and there has been a difference for many years.
 
Why doesn't FOX News just take some money off FOX Sports Net and add it to FOX News. FOX Sports Net isn't worth $2.37 by no means.

I know some markets don't have a FOX Sports Net where instead they have a Comcast Sports Net, NESN, YES, etc.
 
BRNout said:
mnradiofan said:
It's NOT up to me to assign value, like everyone else, I'm giving my opinion. And I'm not basing my opinion on politics. I'm not a leftist or a rightist, I land somewhere in the middle. For the record, I don't care for CNN or MSNBC either. But, when you're comparing prices, its hard to justify Fox News getting anywhere NEAR what ESPN or even Fox Sports get (also two channels I don't watch, yet pay for).

What I'm arguing is that it certainly costs USA (another network I don't watch much, actually) more in rights and production fees than it costs someone like Fox News. The argument that a network is popular and therefore deserves more carriage fees is itself absurd. If a network gets high ratings, then said network should be able to charge more for advertising. Comparing based soley on popularity, I can get CNN and HLN for less than I can get Fox News currently. Not only that, but USA, TNT, TBS, and Nick all have higher ratings than Fox News yet charge significantly less.

I am sorry, but your post belies a lack of understanding when it comes to how the marketplace works. For one thing, how can you possibly say that Fox News doesn't 'deserve' nearly what Fox Sports gets? Personally, I am amazed that FSN gets as much as it does with so many second-tier and lower sporting events that few care to watch. The only reason that they're picked up by some systems is that FOX negotiates a package deal and if you want the local FOX O&O, FOX News and other channels then you have to eat FSN.

As far as value and demand goes, Fox News is worth far more to any carrier and is in more demand than FSN ever will be. Also nonsense is the comment that FSN has higher costs than FOX News. Do you have any idea how expensive a 24/7 national news operation is to run? Their costs are MANY times higher than FSN's. As an aside, the way that Comcast gets screwed for providing FSN is probably why they have the FOX Movie Channel relegated to the sports tier. And why I don't get to see it.

Lastly, although USA and the others you mentioned tend to peak with higher ratings than any news channel, the viewership patterns are inconsistent. Again, your perception of costs is skewed because it's far cheaper to air reruns and select dramas produced by your corporate parent (as USA and TNT do) than it is to run a news network like FOX News. It's not even close. Eluding to the start of this paragraph, if your cable outlet dropped FNC, they would lose a LOT of subscribers. Just as they would if they dropped ESPN. If they dumped USA, TNT, etc., they'd lose some but not nearly as many.

This is a market-driven decision. FOX News has their market to themselves. The people who like that channel will demand that channel from their provider. Admittedly, losing a channel like TNT, TBS, USA, etc. would be bad for a service provider. But the economics of such channels is different than the economics of an ESPN or FOX News. They usually come as part of a much larger package and - once again - are much cheaper to operate.

If CNN or MSNBC had FNC's viewership numbers, they'd be trying to get more per subscriber too. FNC has the same things going for it that ESPN does. Also, let's not forget that they are bundling FOX Business Channel in the deal.

As for your comment about selling ads, that's actually a different issue - which is only partially related. This is about payment for carriage and not ad sales. There's a difference and there has been a difference for many years.

To say that this post isn't politically motivated, would be very untrue in my opinion. You're ignoring or deflating several things.

First off, I can only speak for my local FSN affiliate, but LOCALLY, they not only have the cable exclusive rights to air local baseball, local basketball, and local hockey (most games of the season) but they also have many local college sports rights locked up. Those rights do NOT come cheap, and I'm sure MANY more people would drop cable if FSN was dropped than if Fox News was dropped, as people are extremely addicted to their sports. Not only that, but my local FSN produces live pre and post game shows, as well as weekly shows dedicated to the local football team, when applicable. FSN also produces most of these sports broadcasts. Much more expensive to do that, and much more of a unique "draw" than yet another commentary channel.

Second, running reruns (and original programming, can't forget about the original programming) doesn't come cheap either. Just because they are repeating programming from their parent companies, does NOT mean that this programming comes for free.

Yes, I realize that people need to be hired to run a national news network, and that it's NOT cheap. But, my main point here is that it ALSO isn't cheap to run a sports network, or a general entertainment network, and in some cases it is quite a bit more. Yes, I understand that it is supply/demand economics OF THE FANS that watch Fox News. But YOU seem to discount that there are FAR more people who do not watch Fox News (or any news for that matter) than do.

Also to your last point, Fox News is NOT including Fox Business in that price, that channel is available for a separate cost, but is usually being mandated by Fox in order to reach a carriage deal with Fox News, or FSN, or any of the other networks it owns.

And BTW, it's not TRUE supply/demand economics here, as there are other factors at play, such as the demands I mentioned above. Had Fox not demanded coverage of Fox News in exchange for carriage of other networks when it started up, then Fox News may not even exist today. Same is true of dozens of other networks.

What would be really interesting is if true Ala Carte ever becomes a reality. How many people would be willing to pay Fox News, MSNBC, CNN, HLN, or the hundreds of other cable networks almost directly....
 
BRNout said:
Who are you to determine what you think is enough? If FOX (News Corp.) is getting $2.37 per subscriber for Fox Sports (which is totally absurd, BTW), and the market supports that, then FNC is almost certainly being undervalued from their point of view. A 24-hour news channel is expensive to run, but likewise FNC has been a resounding success story for News Corporation. The average time spent watching is through the roof and they typically get more viewers than CNN and MSNBC combined. The people who watch that channel find it important and tend to be very loyal to it.

Comparing Fox News to the sports channels is not valid.

Regarding the cost of operation, running a 24-hour news channel might be expensive...but that's not what Fox News is doing; they're running a 24 hour talk station, which is relatively cheap by comparison. I would bet that ESPN spends more per year on Monday Night Football than Fox News spends for it's entire programming schedule over the course of a year. So higher affiliate fees certainly can't be justified based on cost of operation, because Fox News is cheap to run compared to a sports network.

Regarding viewer demand -- Fox News is in a strange position, because it has some fiercely loyal viewers...but not a large number of them. In a recent survey of the "must see" TV networks, Fox News is notable in its absence from the list. CBS tops that list at 35% of viewers naming them. The top cable network is ESPN, at 31%. CNN comes in at 8%. Neither Fox News or MSNBC is on the list at all...and the lowest scored network on the list (Showtime) comes in at 5%. So that means that Fox news (and MSNBC) was named by fewer than 5% of viewers as being a channel that they can't live without.

While I don't doubt that any service that dumps Fox News is going to lose subscribers, the number of subscribers that they would lose is likely far, far smaller than would be lost if ESPN was dropped. Probably much smaller than for FSN, even though FSN also fails to make the list. The difference is that FSN is really a bunch of regional networks instead of being a national network. But in areas where FSN is carrying the games of the local baseball or basketball teams, I'd bet that dropping FSN would upset a lot more viewers than would dropping Fox News. In general, there are a lot more viewers who care about live game coverage than who care about partisan talking heads.

Bottom line: while Fox News may be able to extract further rate increases from service providers, they are delusional if they really think that they're worth anywhere near as much as ESPN. And they're probably not even close to FSN in perceived value.
 
TexasTom said:
BRNout said:
Who are you to determine what you think is enough? If FOX (News Corp.) is getting $2.37 per subscriber for Fox Sports (which is totally absurd, BTW), and the market supports that, then FNC is almost certainly being undervalued from their point of view. A 24-hour news channel is expensive to run, but likewise FNC has been a resounding success story for News Corporation. The average time spent watching is through the roof and they typically get more viewers than CNN and MSNBC combined. The people who watch that channel find it important and tend to be very loyal to it.

Comparing Fox News to the sports channels is not valid.

Regarding the cost of operation, running a 24-hour news channel might be expensive...but that's not what Fox News is doing; they're running a 24 hour talk station, which is relatively cheap by comparison. I would bet that ESPN spends more per year on Monday Night Football than Fox News spends for it's entire programming schedule over the course of a year. So higher affiliate fees certainly can't be justified based on cost of operation, because Fox News is cheap to run compared to a sports network.

Regarding viewer demand -- Fox News is in a strange position, because it has some fiercely loyal viewers...but not a large number of them. In a recent survey of the "must see" TV networks, Fox News is notable in its absence from the list. CBS tops that list at 35% of viewers naming them. The top cable network is ESPN, at 31%. CNN comes in at 8%. Neither Fox News or MSNBC is on the list at all...and the lowest scored network on the list (Showtime) comes in at 5%. So that means that Fox news (and MSNBC) was named by fewer than 5% of viewers as being a channel that they can't live without.

While I don't doubt that any service that dumps Fox News is going to lose subscribers, the number of subscribers that they would lose is likely far, far smaller than would be lost if ESPN was dropped. Probably much smaller than for FSN, even though FSN also fails to make the list. The difference is that FSN is really a bunch of regional networks instead of being a national network. But in areas where FSN is carrying the games of the local baseball or basketball teams, I'd bet that dropping FSN would upset a lot more viewers than would dropping Fox News. In general, there are a lot more viewers who care about live game coverage than who care about partisan talking heads.

Bottom line: while Fox News may be able to extract further rate increases from service providers, they are delusional if they really think that they're worth anywhere near as much as ESPN. And they're probably not even close to FSN in perceived value.

Exactly my points, although I didn't have the numbers to back them up as you did.

Time and time again, when people are asked "why they don't cut the cord" it is usually because of live sports, which are delivered via ESPN, FSN, etc. Yes, outside of local sports, FSN is weak at best, but local sports are such a draw that losing FSN is a non-starter. A local operator around here dropped FSN in a carriage dispute and Sat dishes were flying off the shelves, because most of the hockey, baseball, and basketball games are exclusively carried on FSN (save for national hockey carried on VS, or the local "game of the week" packages that are on OTA TV).

The local system where I grew up didn't have, and there was no demand, for Fox News, for many years. It wasn't until the digital upgrade in 2002-2003 that we even had the channel, and that was because it, along with FMC, was forced on the operator by Fox in return for carrying the more popular Fox, FX, and FSN.
 
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