Kagan Puts Retransmission in Perspective

In a report that is sure to be fully embraced by the broadcast community, SNL Kagan said that retransmission consent fees, also known as the bane of multichannel video service providers, account for just 8.9% of total fees distributors pay to networks and is expected to rise to just under 13% by 2017.

The Kagan report comes just weeks after the Federal Communications Commission moved to prohibit Joint Sales Agreements where two of the top four stations in a market join forces to negotiate retransmission deals. Part of the reason for the ruling was to prevent what some MVPDs have said was onerous pricing for retransmission and to stop blackouts of channels. In its analysis, SNL Kagan said they saw little evidence for either.

The research house said that rising retransmission fees are just one factor in escalating programming costs -- others were the additional expense of TV Everywhere and multiplatform agreements, increasing costs for cable network programming (especially sports), and additional channel launches.