TVNewsCheck

When the Federal Communications Commission adopted a rulemaking aimed at setting the rules for the incentive auction of TV spectrum and repacking of the TV band in May, the National Association of Broadcasters expressed deep concerns about it.

Now that the trade group has had a chance to read the 500-page text of the rulemaking, its concerns have only deepened.

"The order's fundamental flaw is that it ignores Congress's clear direction to do no harm to broadcasters who choose not to participate in the voluntary auction," said NAB President Gordon Smith. "Instead, the [FCC] goes so far as to suggest that the goal of repurposing broadcast spectrum for mobile broadband is superior, rather than equal to, that of maintaining a healthy and robust broadcast industry.

Verizon has begun to demo a new approach to delivering video over its vast LTE wireless broadband network that will allow it to mimic and compete with broadcasting.

The technique, which the company calls LTE Multicast, permits Verizon go beyond one-to-one delivery to broadcasting-like, one-to-many delivery. For its most recent demonstration of the technology, Verizon transmitted multiple camera angles of race coverage from the Indianapolis 500 to some crew members in the pit at the track.

The wireless carrier used an undisclosed number of cell sites near the Indianapolis Motor Speedway for the demo. The crews, which were given Samsung Galaxy Note 3 smartphones and Sequans tablets enhanced with special LTE Multicast chipsets to receive the Verizon broadcast, used the devices to view specific camera angles of the race and give their drivers a tactical advantage.

The Indy trial of LTE Multicast follows its rollout at a special technology showing in New York City’s Bryant Park as part of the festivities surrounding Super Bowl XLVIII on Feb 2. “This is a very spectrally efficient way to deliver large quantities of data, primarily video, to a particular area,” says Verizon spokesperson Debi Lewis.

According to a new study from the Consumer Electronics Association, The Market for US Household Television Services, the percentage of US households with a television that relies exclusively on an antenna for reception (6%) is about to be eclipsed for the first time by the percentage of households relying only on the Internet for TV programming (5%).

CEA data since 2005 shows a continuous decline in the percentage of US TV households relying only on antennas for programming. “We are at a pivotal point in consumer behavior, as fewer and fewer American homes are now using only antennas to watch their favorite television programs, and more and more households turn to the Internet as a source of TV content,” said Gary Shapiro, president-CEO, CEA.

Despite phenomenal growth in tablet and smartphone penetration rates, televisions are still the most widely used viewing devices, according to the study. TVs have the highest household penetration of any viewing devices (97%) and strongest video content viewership (93%), especially now that Internet-enabled televisions have reached mainstream consumers. According to the study, viewership of video programming on connected devices continues to grow. Nearly half of TV user households watched video on either a portable computer or smartphone, and more than a third watched on either a tablet or desktop computer.

Specifically:

• 46% of US TV user households watched video on either a laptop, notebook or netbook (up from 38% in 2013)
• 43% watched video on a smartphone (up from 33% in 2013)
• 35% watched video on a tablet (up from 26% in 2013)
• 34% watched video on a desktop computer (up from 30% in 2013)
• Additionally, the study shows the percentage of US TV households consuming at least some TV programming via the Internet has nearly doubled. Almost half of US TV households (45%) received at least some television programming from the Internet in 2014, a 17 point increase from 2013 (28%).

David Lougee has an idea for broadcast syndication. If the president of Gannett Broadcasting has it right, by fall 2015, viewers will interact with celebrities on talk shows and game shows via social media on their smartphones and tablets.

“There’s an opportunity for us and other broadcasters to take advantage of the organic relationship between social media and television,” Lougee says. “The majority of our viewers have an Internet-enabled device within three feet of them when they are watching television.”

“Whether it’s a smartphone or a tablet, it’s a direct-to-consumer relationship,” he says. “It doesn’t go through the cable provider’s set-top box. There is no gatekeeper. So, the only thing we’re limited by is the imagination of the producer.”

The Federal Communications Commission has all but slammed the door on a broadcast industry proposal that could have made it easier for TV station groups to introduce a new advanced television standard in the US, broadcast industry sources said.

Under the proposal, originally pitched at the FCC by Sinclair Broadcast Group, TV station groups that agreed to forego federal reimbursement for any stations forced to move to new channels during the agency’s incentive auction repacking process would have received a waiver allowing them to use the existing spectrum for all their stations’ channels for traditional broadcast and other new services.

Some broadcasters, led by Sinclair, want to be able to use at least part of their existing spectrum capacity to introduce an advanced TV standard that would make it easier for them to broadcast a variety of services to consumer mobile devices. But in the fine print of the 484-page text of the incentive auction rules the agency released June 2, the FCC rejected the request for a blanket waiver that would have applied to all of a group broadcaster’s stations.

TV broadcasters’ retransmission consent revenue will come in at $4.3 billion in 2014 and continue to grow at a brisk pace, hitting $5.1 billion in 2015 and $7.6 billion in 2019, according to the latest analysis from SNL Kagan.

According to the research, retransmission revenue is also becoming a rapidly growing share of station group’s total revenue. Among the 18 groups covered in the research, the share ranged from 24% (Meredith) to 10% (Scripps) in 2013. Others getting more than 20% of their revenue from retransmission include Sinclair (24%), CBS (23%), Fox (22%), Nexstar (20%), Allbritton (20%) and LIN (20%).

The research also found a broad range of retransmission revenue on a per-subscriber, per month basis. In the fourth quarter of 2013, Sinclair was at the top, earning $1.07. Right behind were LIN ($1.06), Fox (96 cents) and Meredith (96 cents).

Despite the growth, what broadcasters receive from multichannel video program providers will continue to be dwarfed by what basic cable networks and regional sports channels receive, the research says. Retransmission will amount to only 10.5% of the cable programming fees in 2014 and 11.4% in 2015.

Historically, broadcast TV's biggest foes have been cable and newspapers, but now there seems to one more major adversary: wireless operators.

Wireless has been lusting after broadcast spectrum, supporting the Federal Communications Commission's incentive auction. That's even more threatening since the auction push is headed by FCC Chairman Tom Wheeler, the former wireless trade association chief.

Now, with Verizon's nascent LTE Multicast service, it's also planning on making a direct play for TV stations' audiences as well.

Nielsen announced what it calls “a significant and broad expansion” to its ongoing sample improvement plan for local television markets.

Starting this year, Nielsen will increase the sample size in 15 Local People Meter markets. Five previously announced markets -- Dallas, Washington, Houston, Miami and Denver -- will see an increase of 200 homes this year.

The two largest markets, New York and Los Angeles, will have their sample sizes increased by 300 homes next year. In addition, the following eight markets will each have their sample size increased by 200 homes in 2015: Charlotte, St. Louis, Chicago, Philadelphia, San Francisco, Boston, Atlanta and Phoenix.

These sample increases represent on average a 30% increase in sample size. In the 31 set meter markets, Nielsen will expand the sample by 200 homes in each market over the next two years. The addition of these 6,200 homes represents an almost 50% increase in sample size across the set meter market footprint, Nielsen says.

Single frequency networks may be the technology that makes it possible for television stations compete with wireless in reaching viewers on their mobile devices.

Proponents say these booster sites can provide strong signals throughout a station’s coverage area. However it comes at a price: capital costs to implement such booster networks could hit $2 million per market.

Antitrust experts say AT&T's bid for DirecTV could reap immediate regulatory rewards. Coming so quickly on the heels of a rival cable company merger -- the pairing of Comcast and Time Warner Cable -- makes it easier for regulators to approve both transactions because they create two counterbalanced giants in pay TV.

Experts say the potential benefits of bigger scale, cost savings and promised reinvestment in networks to create speedier connections could be seen to outweigh the damage done to consumers by a reduction in the number of competitors.

"The antitrust regulators might be thinking about Comcast-Time Warner Cable becoming a Goliath with lots of small Davids," said Amanda Wait, a former antitrust attorney with the Federal Trade Commission and partner at Hunton & WiIliams LLP in New York. "What the AT&T deal does -- if it gets approved -- is it creates another strong competitor that looks more like a Goliath than a David. It levels the playing field a little bit," she said.

Although each deal will be examined on its own by the Federal Communications Commission and the Department of Justice, regulators look at the current and future marketplace, according to Justice Department spokeswoman Gina Talamona. "We consider the market as it exists today and where the market may be heading with any pending or proposed deals," she said.