Disney-Cablevision standoff highlights revised values

An L.A. radio reporter did one of those dim-witted Academy Award previews last week where he noted that while going to movies can be expensive, “Watching the Oscars is free.”

Sure, Einstein, just like all radio is free. Get Sirius.

As Disney and Cablevision demonstrated leading up and finally into the Oscar telecast — blacking out the show’s opening minutes on WABC-TV in New York — free video content isn’t a sustainable business plan. That simple equation is eventually going to force everyone to contemplate a more perplexing question: What’s it worth to you?

The latest, very public fracas in the ongoing tussle over retransmission payments from cable operators to TV stations provides a focal point for this discussion, illustrating the myth of “free TV.” Still, in terms of measuring broadcast programming’s economic value, the Disney-Cablevision standoff, while colorful, is a rather blunt instrument.

In the generic sense, ABC isn’t worth anything to viewers. That’s the peril of big-tent broadcasting — unlike, say, the Food Network or Golf Channel, where small groups of enthusiasts can go as a default option.

The network’s programs, however, are worth a lot, from the Oscars to “Lost,” “Grey’s Anatomy” to the NBA Finals, “Good Morning America” to “Modern Family.” Deprive TV junkies of those fixes, and watch them howl in protest.

Assessing ABC’s monthly price tag against that of basic cable networks is equally imprecise, whether it’s the nearly $4 subscribers shell out for ESPN’s package of channels or lesser sums for TNT or FX, whose signature shows draw much smaller audiences than “Desperate Housewives.” The main difference historically is cable nets existed exclusively via that means of distribution, whereas “Lost” can still be accessed via a pair of rabbit ears — which, admittedly, might make the smoke monster look even smokier.

Even in tough economic times, consumers have exhibited scant willingness to go on a media diet and part with cable or satellite service. Just over 90% of U.S. homes — 103 million of them — pay for some form of subscription TV service, according to the most recent data from Nielsen.

But the option is increasingly there, whether it’s downloading episodes via iTunes or buying full seasons of TV programs on DVD to watch at one’s leisure. Companies like Google and TiVo are also circling ways to wed the web with TV, fracturing traditional models.

When ABC canceled the brilliant drama “My So-Called Life” in the mid-1990s, I modestly proposed that a weekly 50-cent fee from avid viewers would be enough to save the series. What sounded absurd then — who even had the facility to orchestrate such a transaction? — has since become commonplace.

Comcast’s proposed acquisition of NBC Universal reflects the former’s recognition that its distribution apparatus is vulnerable and the company must control content able to command such loyalty. Yes, the photogenic Kardashian gang has inflated E!’s ratings, but Comcast’s portfolio of channels (quick, when was the last time you watched G4, Versus or Style?) doesn’t possess the same hold on viewers as the fare on USA or Bravo.

Buying NBC thus becomes Comcast’s hedge against a future where a better idea or gadget can render its pipes and wires obsolete. Still, cable is only one potential loser if the world shifts from bundled prix fixe menus toward a la carte consumption, which — like the financial squeeze created by broadcast retransmission — threatens to leave niche channels out in the cold unless they have other assets to leverage.

Not surprisingly, the Disney-Cablevision brouhaha had many wishing a pox on both their houses — and some fuming about the dissolution of regulatory safeguards. Former syndication exec Norman Horowitz, for one, noted in an online post that he blames recent presidents and Congress, along with a process “that allows money to speak for the powerful and leaves no one to speak on behalf of the public interest.”

Granted, we’ve traveled quite a ways since “My So-Called Life” died, back when there was quaint talk of a vaguely defined thoroughfare known as the Information Superhighway. While there’s no discounting the digital age’s blessings, only a fool or a radio reporter could overlook that after years of cheap transportation, we’re merging onto a toll road where — one way or another — nobody rides for free.

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