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Albert Fried & Co. Director of Research Richard Tullo and Ovation COO Chad Gutstein on how Cablevision’s lawsuit against Viacom could impact the...
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Radio free -- anything like me you probably aren't but you probably are sick and tired of panic huge cable bill for channels you don't even watch.
-- the chance that model one day could end Cablevision is suing cable channel giant Viacom saying quote.
Viacom effectively forces Cablevision -- customers to pay for and received little watched channels as case could set a precedent.
For a whole new way of paying for cable Alan Clarke.
Maybe even bring those bills down a bit.
With -- now our media analyst Richard hello and Chad Goldstein CEO of ovation -- small arts channel that was dropped by.
Time Warner Cable last month.
Rich -- thanks for joining us and let's start with you.
Do you actually think this lawsuit from Cablevision which is going after a practice of bundling that is bitter the cable industry for a couple of decades.
Can -- have an impact could help break up the dial.
Yeah I think -- right so.
Jim Dolan who is the Rodney Dangerfield of cable industry see you know is is actually on the side of the angels here.
Because a lot of content owners are getting in between the way consumers.
Want to consume media.
And the way artists make a living.
Capturing economic -- for themselves.
Now ovation is a different story there are no no type -- network.
But when you have a situation.
Where in Minneapolis.
Viacom.
Has very low ratings for black entertainment television.
Any New York is very low ratings for Country Music Television.
Hey why -- a cable company have to.
You have to -- -- hope for you maybe this twelve -- thirteen putting the right track 1213 people watching this stuff in prime time.
Right exactly out.
Viacom forcing Cablevision which wanted to eight channels could also order fourteen other channels as well Chad.
Over there -- ovation.
It seems like you would be a better plaintiff in this lawsuit saying that -- channel is being stopped from getting on board other cable systems.
By these terrible bundling agreements have you ever looked at suing over this is -- a problem that affects your business.
But just thank you so much for having me on it absolutely is a problem that affects our business and it happens -- affect the consumer as well.
You know the bundling that has been going on at the business to business level which is different than the retail level that Richard was talking about the consumer -- The business to business level that is really what's going on in this losses.
You've got anticompetitive bundling practices that twenty years ago may have been perfectly fine when there were a lot.
Many more companies that were operating in the pay TV market to pay TV -- in the United States of America is not a free market.
It's -- highly regulated market.
And today there are only ten companies that control 95 plus percent of the pay TV households and their ten giant programming companies.
Like News Corp.
That control the vast majority of the networks that are being distributed to OK so in that.
Very concentrated market environment.
It's been it's virtually.
Impossible for the small independents like ovation and a few others out there to compete on an equal playing field.
Okay but you -- -- rich the fact is when Time Warner Cable.
-- innovation.
They do because we've got no room left on the dilated because they feel -- -- you guys don't get high enough.
Your ratings didn't digital compression allow all the cable -- already scheduled -- -- -- want let's back off an -- second.
They -- innovation.
Because ESP and hit him up with a 30% price increase and the need to make room in the budget.
And ovation.
Was the casualty okay okay which is a big difference but you're exactly clear that they give the customer pay for -- in four.
Which is on watched OK and bundled with ESP NY is okay for cable system make that decision what wide is that is cable -- acting as if it's a victim in this chat.
-- -- -- -- -- -- -- -- -- -- -- -- -- -- -- It's looked more religious is exactly right Time Warner Cable through ovation off because ovation is an independent network and they can throw us off because we're not going.
In this market environment where you have big companies and other side.
There are assets each of them need Cablevision cannot effectively compete in -- -- carry MTV and -- they carry Nickelodeon.
And because of that.
Viacom uses its leverage.
To throw against them all the networks the smaller networks -- directly competes against.
But don't have to earn their place on the dial every day quotation have to earn its place on the dial every single day -- that's -- casualty.
-- -- rich -- shareholder in Viacom don't you want Viacom to do exactly this practice of bundling in the short term it's effective.
In the long term it's unsustainable.
The F war.
It's a problem for the industry.
Right because when -- -- -- stable people can afford a 150 dollar cable bill and that the current rate of inflation school before 500 dolls in years from now.
People can afford that this all right breaking that cycle so the cable bundles that incredible value.
Bullish unemployed and to watch schedule 500000 TV IRA.
This this fight is just beginning -- hoping did you guys back on -- talking about thanks for being us with this rich -- -- and Chad good time.
Thank you gentlemen thanks that you so much.
