Good Question: What Are We Paying For Cable/Satellite Channels?
MINNEAPOLIS (WCCO) — A dispute between the owners of DirecTV and MTV, Nickelodeon and Comedy Central has 20 million DirecTV subscribers without 17 channels owned by Viacom. Depending on whom you believe, Viacom yanked the channels or DirecTV blacked them out because of a dispute about retransmission fees.
So how much are consumers paying for pay TV channels?
More than 100 million Americans subscribe to cable, satellite and pay TV sold by telecommunications companies. The channels charge per subscriber – it’s called a retransmission fee. Even local channels, like WCCO, now charge those fees.
With all those subscribers, a fee of even 7 cents per subscriber per month can quickly balloon to $7 million per month.
But analysts who research cable and satellite companies say the sports channels are by far the most expensive.
ESPN and ESPN 2 combined cost more than $5/subscriber a month. That’s about 20 percent of the total programming costs, according to Craig Moffett, a senior analyst with Sanford C. Bernstein.
Moffett said those channels only make up 2.5 percent of viewership. But rights fees for games are expensive, and hard core sports fans are more likely to cancel service if the channels were gone.
According to research from SNL Kagan, published at AllThingsD.com and confirmed by the company to WCCO, the wholesale price for Fox Sports Net is $2.37 per subscriber. NFL Network costs 75 cents, as of 2009.
Most channels are far cheaper than that, averaging around 20 cents per subscriber a month.
For example, Food Network costs 8 cents per month. Nickelodeon is the top rated network. In 2009 it was getting 44 cents a subscriber.
Lifetime costs 28 cents a month, while each subscriber pays 9 cents a month for Lifetime Movie Network.
After ESPN and Fox Sports Net, TNT is the third-most expensive, costing the cable and satellite companies 99 cents. Disney Channel is 88 cents.
For a complete list of the channels and their cost, click here.