Washington

Disney Pitches Value of ROI Distribution Models

Tells Congress that high-value content depends on compensation for carriage 6/11/2013 11:49:47 PM Eastern

Disney Media Networks global distribution
president Ben Pyne plans to tell Congress that the retransmission consent
regime is working well as a way to ensure MVPDs compensate broadcasters for the
value inherent in their signal -- "the lion's share of the most-watched
programs on television," local news and emergency information -- and to
allow broadcasters to continue to be able to provide quality content.

That is according to Pyne's prepared testimony for a June 11
hearing in the House Communications Subcommittee on the reauthorization of
STELA, the law establishing a compulsory license for carriage of affiliated TV
station signals.

"Quality content is expensive to produce," he
said. "Last year, we spent approximately $3 billion producing programming
for ABC and our owned stations."

Pyne argues that retrans impasses are relatively rare.
"Over the years, thousands of privately negotiated agreements for
retransmission consent have been reached with extremely few interruptions of
service."

Pyne said Disney wants its programming to be carried by
cable, satellite and telco video providers, but also suggested there were other
avenues.

As if anticipating a question about broadcaster opposition
to the Aereo TV station signal online transmission service, Pyne says that
Disney is committed to improving the viewer experience, including making TV
stations available online via WatchABC, a just-launched service that allows
viewers in New York and Philadelphia to watch their local station online, on
smartphones and on tablets in their home market, a service he said will expand
to other markets this summer. He said Hearst also plans to launch WatchABC on
its ABC affiliates.

He also pointed to ABC's part ownership of Hulu, and its
content deals with Netflix, Amazon, Streampix and "even" Xbox.

But while it has a lot of new play dates in the multichannel
world, ABC still values that MVPD outlet, said Pyne. "While all of these
new forms of distribution are critical to our future, we continue to place a
very high value on distributing content through our MVPDs," he said.
"We believe that monthly video subscriptions purchased by the overwhelming
majority of American households continue to be a tremendous value."

The key to all those distributors, Pyne pointed
out, was that each allows for a return on investment.

 

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