TV Nets Use NFL to Send Your Cable Rates Spiraling

LA WATCHDOG--While America gears up for Super Sunday where the Philadelphia Eagles are looking to upset the England Patriots, few realize that the National Football League and the four television networks (CBS, NBC, Fox, and ABC/ESPN/Disney) are the primary culprits in the rapid rise in our cable bills. 

Over the past ten years, our cable bills have increased at four times the rate of inflation and now average over $100 a month for basic service.  This does not include any premium channels such as HBO or Showtime.  Unfortunately, there does not appear to be any let up as cable operators such as Spectrum (aka Time Warner) continue to raise rates despite the fact that millions of fed up subscribers are “cutting the cord.” Or maybe they have to raise rates even more to cover the fixed costs as there are fewer customers to absorb the overhead. 

We are caught in a vicious circle.  The four networks continue to bid up the price for the television rights for pro football as live sports draw large live audiences that are attractive to advertisers.  The networks, in turn, increase their retransmission fees to the cable operators who then bump our rates to offset the higher carriage fees.  The cable operators also need to maintain their hefty profit margins. The end result is that we are stuck with the bill.  

This cycle seems to be repeating itself.  On Wednesday, Fox Broadcasting announced that it is entering into a five year, $3.3 billion contract with the NFL for the rights to Thursday night football.  This represents a 47% jump in price compared to the price paid last year by CBS and NBC.  Fox will now increase the number of ads per game and at the same time, bump ad rates. Fox and their broadcast affiliates will also strong arm the cable operators into paying higher retransmission fees, threatening a “blackout” just before a big game.  We are then hit with higher cable bills. 

The owners of the NFL franchises are making out like bandits by playing the networks off against one another.  Sunday afternoon football on Fox and CBS.  NBC Sunday night football.  Monday night football on ESPN.  And now Thursday night football on Fox.  And almost $10 billion in fees.  

NFL teams are now charging almost $100 for the average ticket, with high priced concessions ($17 beer) and parking being extra.   They are also coining it by creating luxury boxes where the owners, politicians, and corporate fat cats do not have to mix with the huddled masses.    

The NFL is also building new stadiums, many with the help of local governments that have been extorted by the owners with the threat of departing for greener pastures.  The owners are also pocketing the proceeds from the sale of personal seat licenses to help finance the stadiums. They are also demanding exorbitant fees for the naming rights of their home field arenas. 

But there are fissures in the NFL fortress as ratings have dropped by over 15% in the last two years, requiring the networks to cut rates or provide additional advertising at no cost.  

The popularity of the NFL has dropped, whether it is because of over saturation, too many inane ads, countless meaningless games, injuries to star players, including concussions, the controversy over the national anthem, or the Athlete Arrest of Day.  

Ratings have also been hit as subscribers continue to “cut the cord,” unwilling to fork over $100 a month or more for cable TV. Rather, the Millennials and others are relying on streaming services such as Netflix or rabbit ears for free over the air TV.  

Hopefully we will have a great game on Sunday.  But remember, the Super Bowl is not free TV.  We are getting our pockets picked by billionaire NFL owners, large cable operators such as our friends at Spectrum, and the four networks, CBS, NBC, Fox, and ABC/ESPN/Disney who are aided and abetted by large national advertisers who are willing to pay an unbelievable $5 million for a thirty second spot.   

Fly, Eagles, Fly. 

(Jack Humphreville writes LA Watchdog for CityWatch. He is the President of the DWP Advocacy Committee and is the Budget and DWP representative for the Greater Wilshire Neighborhood Council.  He is a Neighborhood Council Budget Advocate.  He can be reached at:  lajack@gmail.com.)

-cw

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