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After Murdoch completes the sale of most of 21st Century Fox and its studios to either Disney or Comcast, the “New Fox” that will remain will include Fox News Channel, Fox Business Channel, the Fox television network, MyNetworkTV, some sports channels, and 28 owned and operated local television stations. In short, it will be a $23 billion company focused almost entirely on legacy television.

To maximize the value of those remaining assets, “New Fox” will double down on live television to attract and hold the “core Fox viewer,” one who instinctively watches Fox News, enjoys live sports, and more than likely lives in a conservative-leaning state.

Brandon Ross, an analyst at BTIG Research, believes “New Fox’s” crown jewel will be the Fox News Channel, not the Fox television network.

“The strongest asset that’s in their portfolio going forward is Fox News,” Ross said, noting that dedicated viewers of the network will likely see promotions from other Fox-owned networks that will increasingly cater to the interests of the average Fox News viewer. Research shows Fox News attracts an older, conservative, and very loyal audience that is more likely than other demographic groups to also watch live television sports and pay for cable television.

Murdoch’s recent content deals hint he intends to increase Fox’s focus on live sporting events. Last week, CNN reported Fox acquired the rights to broadcast “WWE SmackDown” for the next five years. Earlier this year, it signed another five-year deal to air Thursday night NFL games.

Fox’s scripted television shows will likely take a hit as a result, as investments shift towards live news and expensive sports programming. Murdoch may be signaling it won’t continue trying to keep up in the battle between Amazon, Hulu, and Netflix vs. traditional linear/live television over scripted dramas, original movies, and other pre-produced content. Murdoch’s ability to rely on traditional scripted shows for revenue may also be waning as online content companies break the traditional 24-26 week ad-supported television season.

Netflix’s original content budget was around $6 billion in 2017, more than CBS spent on its own shows. This year it expects to spend up to $8 billion, more than CBS, FOX, and ABC. Fox can still fall back on the two strengths network television still commands — live news and sports. News programming, particularly the kind of political opinion shows Fox airs during the evening, are extremely cheap to produce and attract a loyal audience. Sports programming, in contrast, is extremely costly to acquire. But like news, surveys show more than 90% of viewers watch live, commercials and all.

Jay Rosenstein, a former CBS Sports executive, told CNN that is what makes sports so valuable for a legacy business like Fox.

“There’s been a certainty about sports programming that doesn’t exist with scripted or unscripted programs,” he added. “With sports, you have a known quantity.”

Live sports is one of the few types of programming left where viewers don’t instinctively reach for the remote to fast forward through advertising. Scott Rosner, the academic director of Columbia University’s Sports Management Program, said networks like Fox depend on that to make money.

“What that means is you are sticking around as the viewer,” Rosner said. “You’re far more likely to watch advertising that is being put in front of you.”

That adds up to a lot of advertising revenue because no other programming comes close to beating the ratings of live football games, according to Ross. Networks spend a lot on sports programming, but also earn a lot from lucrative and frequent ad breaks.

Networks opening their checkbooks to spend billions on sporting rights prefer long-term, stable contracts even if they have to spend more to get them. The streaming services, as well as some social media sites, are also dabbling in live sports streaming, and with their deep pockets, traditional broadcast networks could eventually be outbid. At Fox, they have about five years before they need to worry about renewing the contracts they just signed.

“New Fox” will also recoup some of their recent investments from viewers like you. Many expect Fox and their television stations will raise retransmission consent fees charged to your cable, phone, satellite, or online provider to carry Fox-owned networks and stations on the lineup.

NBC News will appeal to cord cutters and online news junkies with a new streaming network to be launched this summer, according to a report in Variety.

NBC News Digital is an experimental project from NBC News and will not duplicate existing NBC and MSNBC programming. Instead, the news division is hiring producers and talent to create new, original news shows for online audiences.

NBC News chairman Andrew Lack hinted that NBC was getting into the live-streaming business back in March, but had offered few details.

Most 24/7 news channels are behind the cable industry’s “TV Everywhere” authentication paywall, requiring viewers to prove they are current paid cable television subscribers to gain access.

NBC will face immediate competition from CBSN, the free digital streaming service from CBS offering live coverage of important news events and a regularly updated playlist of pre-recorded news segments and airings of CBS network news programming and features.

Fox News is working on its own subscription-based online news channel called Fox Nation that is expected to arrive by the end of this year.

In contrast, other cable news networks have been substantially cutting back on digital projects. CNN laid off its digital staffers in early 2018 and MSNBC relies exclusively on streaming material that has already aired on the cable news channel.

Charter Communications is taking the city of El Centro, Calif., to federal court for interfering in a dispute between Spectrum and a local TV station owner that has resulted in two stations being blacked out on the local cable system for nearly three months.

Northwest Broadcasting, Inc., has been in a contract extension dispute with Charter Communications over multiple stations, including its two El Centro-area affiliates KYMA (NBC) and KWST (CBS). Charter accuses Northwest of gouging, claiming “Northwest demanded an 80 percent increase in carriage fees, more than double the rate Charter pays any other broadcaster anywhere else in the entire country.”

On March 7, 2018, the City of El Centro got involved and cited the cable operator, alleging Charter violated five provisions of Article X of the City Code, and began fining the cable company $100 a day for each violation, assessed each day the dispute continues.

El Centro accuses Charter of:

• Discriminating against subscribers based on specific protected classes;
• Failure to notify the city and subscribers 30 days in advance of any changes to cable service or rates;
• Failure to establish a time frame to respond to service interruptions;
• Failure to refund customers for service interruptions exceeding a stated period;
• Failure to notify the city and subscribers 30 days in advance of any changes to the cable television channel lineup.

El Centro Mayor Sheryl Viegas Walker: “I’m taking it to the streets. I’m so fed up with [Spectrum’s] disregard for this community,” KYMA in El Centro reports. (3:02)

Northwest Broadcasting CEO Brian W. Brady strongly disputes Charter’s claims, dismissing them as “lies,” particularly surrounding the removal of two El Centro stations from Charter’s lineup after the cable company claimed Northwest refused permission to continue carrying the stations while renewal talks continued.

“Charter accepted the first two extensions which were offered to them, however, they refused the third extension and took our stations off with 10 minutes notice,” Brady said.

Charter’s lawsuit argues El Centro officials have no right to intervene in the dispute, force Spectrum to put the stations back on the lineup, or require Charter to issue refunds to customers for channels that are no longer available to them.

“Northwest’s pulling its authorization for Charter to carry its broadcast signals is not a ‘service interruption’ within the meaning of the City Code provisions in question,” Charter argued in its lawsuit. “Even if it were, while El Centro demands that Charter ‘cure’ its alleged violations, the only means for Charter to do so is to finalize a retransmission agreement with Northwest. The City’s citations are thus intended to pressure Charter to accept Northwest’s unreasonable terms by imposing fines and intentionally damaging Charter’s reputation and harming its goodwill and relationships with its existing and prospective customers.”

Charter argued giving refunds to customers over the lost channels was “contrary to Charter’s terms of service, and in so doing improperly interfere [sic] with Charter’s contractual relationship with its customers.”

Charter is relying heavily on California’s statewide video franchise law — the 2006 Digital Infrastructure and Video Competition Act (DIVCA), heavily pushed by telecom lobbyists a decade ago, which stripped most local authority over cable systems and transferred it to the state government. Charter is using DIVCA’s light touch regulations to support its assertion El Centro officials cannot interfere in programming disputes and that their actions during the dispute have only made things worse.

“The effect of the City’s actions has been to harden Northwest’s negotiating position and make a deal on reasonable terms even more difficult,” the complaint says.

“I have never seen a corporate entity act with such disregard for our community,” said El Centro Mayor Sheryl Viegas Walker. “We have a contract with them that spells out certain steps that they’re required to take if those kinds of changes are going to be made. They didn’t do that. We wake up one morning and we’re suddenly without two major channels.”

“Rather than negotiating in good faith like all other parties would do and what the law requires, Charter has taken a ‘take it or leave it’ approach,” added Brady. “In an effort this week to get this back on track, Northwest submitted a new proposal to Spectrum. Spectrum’s representative communicated that they really wanted to get this resolved, but would not counter Northwest’s proposal and would not respond at all in writing. Odd behavior for a company that claims to be negotiating in good faith. It appears that Charter would rather bully a small municipality than to engage in a good faith negotiation.”

It appears other small cities are joining Brady’s cause, complaining to the Federal Communications Commission that Charter was unfairly profiting from station blackouts. In Crescent City, Calif., city officials accused Charter of charging a Broadcast TV surcharge of $7.50-8.85/month, but didn’t change or adjust rates after the Northwest Broadcasting blackout began.

“Despite the fact the fee is itemized and justified as a pass-through, Charter did not eliminate or reduce that fee, even though it was no longer incurring costs associated with carriage of … at least two network affiliates,” Crescent City officials told the FCC.

The two California cities have also been joined by officials in Yuma, Ariz. and Jackson, Wyo., where Charter has removed Northwest Broadcasting stations as well.

“We have learned that it is no different for numerous municipalities which have been forced to sue Charter to collect the fees that are contractually owed to them,” Brady said. “Most disputes are settled because Charter uses their army of lawyers to outspend the municipalities forcing the municipality to settle on Charter’s terms, regardless of their contractual obligations. It’s no different for their customers who have told us that Charter recently raised the broadcast surcharge fee in spite of the fact that the programs they want to watch are unavailable because Charter removed the programming. Many have asked for refunds only to be told no. What is the customer to do, sue Charter?”

Northwest Broadcasting Owned and/or Operated Television Stations

KPVI-TV in Pocatello, Ida. was widely seen in parts of Wyoming over Charter Communications until the station was blacked out in a contract dispute. Now viewers want to see Charter fined. (1:11)

Charter officials claim there was insufficient time to notify subscribers about the loss of Northwest Broadcasting stations from the TV lineup, but Jackson, Wyo., officials noted Charter bought a new domain name reflecting the contract dispute at least two weeks before stations like KPVI were blacked out. (1:02)

Jackson city officials question a Charter representative about refunds for customers paying surcharges for broadcast TV stations no longer on Charter’s lineup. (0:57)

How to File a Petition on this Issue with the Federal Communications Commission:

This petition allows for public comment until April 16, but the FCC requires some special steps for individuals wishing to file comment. Below is a list of the requirements to file a public comment with the FCC regarding Charter Communications:

• Members of the public who wish to comment should do so on or before April 16, 2018.
• Filing should be submitted to the FCC via the electronic comment filing system (ECFS).
  • That system is accessible at https://www.fcc.gov/ecfs/filings.
  • A member of the public should type his or her comments and save them.
  • At the top of the ECFS page, select standard filing and in the “proceedings” box, type 18-91 (the proceeding is MB Docket No. 18-91).
  • Fill out the remainder of the boxes with information that is required (some information is optional).
  • At the end of the form, there is a box where saved comments can be uploaded.
• Comments that contain statements of fact (for example, “Here is what happened to me”) should be supported by an affidavit.
• “Comments or oppositions shall be served on the petitioner and on all persons listed in petitioner’s certificate of service…” The petitioners here are the Cities, and the certificate of service is at the end of the communities’ filing, which can be downloaded from https://www.fcc.gov/ecfs/filing/1032236683943.

PBS TV stations in smaller communities and secondary PBS affiliates and public stations in large ones are ending their free, over-the-air television broadcasts after decades of service because of politics, budget cuts and repacking the TV dial to give up more spectrum for wireless providers.

The most significant trigger for the impending closedown of several stations, especially those run from universities, is the FCC’s spectrum auction and reallocation plan, repacking UHF stations into a much smaller number of available channels, requiring stations to buy new transmitting equipment many cannot afford.

The original plan to repack television stations reassured affected broadcasters that the auction proceeds from the wireless industry auctions would cover the costs of the necessary new equipment.

KNCT’s coverage partly overlaps other nearby public stations.

Then Central Texas College, which owns and operates PBS affiliate KNCT in Belton, Tex., learned Republicans in Congress might appropriate only enough funding to cover 60% of the transition costs. The trustees that oversee KNCT, which serves central Texas, realized they would have to find roughly half of the $4.5 million needed to change their channel from 46 to 17 as part of the “station repack” and hope Congress would change its mind and reimburse the station.

That was money the trustees ultimately decided could not be found, especially as annual deficits at the station now average $500,000 — costs covered by the college.

KNCT general manager Max Rudolph, who has been in charge of KNCT for most of its 38 year history, said the station will now have to leave the airwaves.

“The board had to make a tough decision, but repacking was only the tip of the iceberg,” Rudolph said. “It’s economics — dollars and cents.”

KNCT operates with a staff of 15 — including five part-time employees, that take care of both the PBS TV station and KNCT-FM, which will continue on the air. The annual budget for the TV station was about $1 million, half spent on PBS membership and programming. Donors also provided around $160,000 a year.

KNCT-TV serves the Belton/Killeen/Temple/Waco, Tex. market, although KNCT’s signal struggles to reach into the northeastern part of its service area near Waco, where public TV station KAMU-TV in more distant College Station strangely provides a better signal.

The station hopes to continue operations through online streaming and on-demand shows kept on its website, but both require a subscription to internet service. For parts of central Texas, it represents the end of free PBS over-the-air programming.

Last year, Central Michigan University decided to accept a $14 million offer for satellite PBS station WCMZ-TV in Flint to vacate its current UHF channel and close down for good April 23, 2018. WCMZ-TV’s signal reaches as far away as Port Huron, Detroit and Lansing. But its intended market was Flint, which lacked local PBS service when the station signed on more than 30 years ago. Today, Central Michigan University still operates its primary station WCMU in Mount Pleasant, along with WCMV, which serves Cadillac and Traverse City, WCML, serving Alpena, Petoskey, Cheboygan and the Straits of Mackinac, and WCMW, which broadcasts to the Lake Michigan communities of Manistee, Ludington and Pentwater.

CMU officials are pulling the plug on WCMZ because, they claim, 99 percent of viewers live in areas that are now served by other public broadcasting stations. While cord cutters may miss WCMZ, cable and other pay television customers likely won’t because the service is expected to continue uninterrupted on cable and possibly satellite.

KMTP, San Francisco’s youngest multicultural public television station, is looking for a new home after selling its spectrum for $87.8 million in last year’s FCC auction. KMTP is licensed to Minority Television Project, Inc., a not-for-profit corporation, and serves the San Francisco Bay Area with non-commercial public television. KMTP broadcasts international programming in multiple languages including English and is not affiliated with PBS.

Its best chance to survive is dependent on an acquisition or arrangement with Poquito Mas Communications LLC, the licensee of low-power KCNZ in San Francisco, which is best known for carrying Creation TV, a Chinese language religious network. KMTP can either occupy several of KCNZ’s subchannels, or potentially buy the station outright. As a low power outlet, KMTP can hope to keep carriage on cable television, giving it perfect reception in areas where KCNZ’s low-power UHF transmitter cannot reach. But that means cord-cutters may have no access to the channel unless they live near the transmitter.

WUSF-TV, on the air in Tampa for 51 years, signed off late last year after the University of South Florida decided to liquidate the station for $18.8 million in auction proceeds from the FCC’s spectrum auction. The area’s larger PBS station, WEDU, has absorbed most of the programming that used to appear on WUSF, which now appears as a virtual subchannel on WEDU — unofficially called WEDQ.

Today, WEDU carries six different signals on its over the air digital channel: WEDU/PBS HD, PBS World, PBS Kids, WEDU+, Florida Channel, and Create TV. Many of these services are also available on cable television. But the original competing voice from WUSF is now gone.

WYCC in Chicago was the city’s second PBS affiliate, behind the larger and better known WTTW. Licensed by City Colleges of Chicago, the trustees decided to liquidate WYCC last year for cash as part of the FCC’s spectrum auction.

WYCC began its operations in 1983 with a message from President Ronald Reagan, congratulating the station for producing adult learning programming lacking on commercial television. WYCC first ended its PBS affiliation in 2017 and had one sole program provider, MHz Networks’ WorldView, when it ceased broadcasting on Nov. 27, 2017.

WTTW has sought to claim WYCC’s remaining assets and intends to place WorldView on one of its subchannels in the future. It already grabbed two Australian shows WYCC used to air:  “Miss Fisher’s Murder Mysteries” and “The Doctor Blake Mysteries.” All that will remain of WYCC are its “call letters,” which could possibly reappear when WTTW launches WorldView.

No TV for you until you sign here.

Charter Communications is asking owners of apartment complexes, nursing homes, independent living/assisted care residences, and hotel and motel owners to sign new agreements allowing Spectrum to lock owners into a 10-year contract that includes a provision allowing retroactive rate increases and a requirement to turn over personal information on every resident to the cable company.

A number of apartment complexes bundle “free cable TV” into the lease as a selling point for renters. Others pay a discounted rate that is part of a resident’s monthly rent payment or service fee. These agreements are part of the murky world of “bulk service contracts” for cable service, and disputes between a property owner and Spectrum can cause the loss of cable service for every resident without warning.

Most of the disputes involve apartment complexes, assisted-living facilities, and hotels/motels formerly served by Time Warner Cable. Most are still under relatively short-term contracts with Time Warner Cable, which was acquired in 2016 by Charter Communications. Good Shepherd Fairview Nursing Home in Binghamton, N.Y. and Good Shepherd Communities, a senior living center in Endwell, N.Y., are good examples.

Mike Keenan has been involved in long-term senior care for 30 years, and over that time he has negotiated hundreds of contracts. But as WICZ in Binghamton reports, nothing prepared him for dealing with Spectrum and Charter Communications.

Good Shepherd Village is a senior living center in Endwell, N.Y.

Charter is using its ongoing digital conversion program as a tool to force “bulk contract” holders to sign new agreements with Charter Communications, often replacing still-valid contracts with Time Warner Cable. Many are not happy about the new terms Charter is offering, particularly one that locks them in with Spectrum service for the next decade and another that allows the cable company to raise rates retroactively.

Those unwilling to sign new contracts have been threatened with service being shut off, usually as digital conversion and TV signal encryption reaches their area, which requires new equipment to keep watching. Those complex owners that still refuse to sign are required to share each tenant’s personal details and address with the cable company.

“Spectrum had taken the position that even though we had a contract in force until December 2018 that we needed to sign a new contract immediately,” said Keenan, president and CEO of Good Shepherd Communities. “If not, they threatened that we would lose service at our Good Shepherd Fairview in Binghamton location and our Good Shepherd Villages at our Endwell location.”

Charter was true to its word. Efforts to negotiate obtaining digital adapters or set-top boxes under the old Time Warner Cable contract failed and with no warning, all 161 nursing home residents at Good Shepherd Fairview lost their cable television on Feb. 27. Two weeks later, 264 residents at Good Shepherd Village — the senior living center — also lost their television and internet service.

The loss was devastating to residents, especially at the nursing home.

“Many of the residents are frail, some of them may be bedridden and their TV means everything to them,” Keenan said.

Keenan’s contract with Time Warner Cable was still valid, and its terms made it clear as long as Good Shepherd kept their payments current, they were owed service that Charter ultimately took away from hundreds of residents.

Apartment complex owners around the country are reviewing new contracts from Charter Communications and many are dropping “free cable TV” after decades of offering the service as an amenity included in the rent. Many who are ending their contracts believe a growing number of tenants neither need or want traditional cable service.

The deal-breaker for many is Charter’s insistence on offering a bulk discount only if the entire building signs up for service, which means owners will have to pay out-of-pocket for Spectrum service in vacant units or in apartments where the tenant has service with another provider.

WICZ in Binghamton, N.Y. reports Charter Communications used nursing home residents as pawns to force the hand of a nursing home manager to sign a new Spectrum contract, even though the current one with Time Warner Cable has not expired. (3:11)

Keenan

“Let’s say you’re paying for Spectrum” – the brand name for Charter’s service – “for 100 percent of the units,” attorney Tara Snow, a partner at Novitt, Sahr & Snow, told Habitat. “You may have 90 or 95 percent of the apartments signing up, but you always have some units that don’t.”

That leaves someone on the hook, either tenants or the property owner, to pay for cable service that nobody is watching. Under Time Warner Cable just a few years ago, the cable company would pay a co-op, condo association, or apartment owner an upfront cash bonus and ongoing “revenue-share fees” for getting a majority of residents — but not all — to sign up for service. It also allowed the company to market holdouts door to door.

No such luck with Charter, which wants to be paid for every unit no matter who is at home. For property owners staying loyal to Spectrum, some are absorbing the extra costs while others pass them on to tenants as part of their rent or monthly maintenance/service surcharges. A few are trying cost sharing arrangements that divide up the total bill equally among all tenants. But as younger renters move in and increasingly show no interest in cable television, the dwindling number who have cable are paying more and more to cover those that don’t.

“People are cord-cutting,” says Brian Scally, vice president of Garthchester Realty, a management firm. “Most people who still want cable want to select their own cable/internet/telephone provider.”

Of the 64 properties he manages, Scally told Habitat fewer than a dozen have signed up for a bulk rate, and those deals were signed years ago.

“I haven’t brought anybody new to bulk rate,” he says.

The other deal breaker for many is Spectrum’s 10-year contract, which locks owners in with a cable company a lot of tenants despise.

As a result, a growing number of apartment complexes and condos are terminating their bulk cable contracts as they expire, and have no intention of renewing under Charter’s draconian terms. Affected tenants are informed the “free” cable television they were receiving is ending and they should make individual arrangements with Spectrum to maintain service going forward.

Hotel and motel owners are also finding fault with Charter Communications, and some are taking their disputes to the Federal Communications Commission.

Yvonne Peach, who owns the Historic Coronado Motor Hotel in Yuma, Ariz., says dealing with Charter has been a nightmare since the merger.

After Charter converted commercial Time Warner Cable and Bright House customers to Spectrum plans and pricing, she lost service to all of her motel rooms for more than a week.

Historic Coronado Motor Hotel – Yuma, Ariz. (Image courtesy of owner)

“When they did the change over we didn’t have any cable TV in the hotel for 12 days,” Peach told KYMA-TV.

Spectrum advised her best solution would be to install leased set-top boxes in the hotel’s 126 rooms, a solution she claims caused even more problems. It seems Spectrum’s equipment doesn’t appreciate Yuma’s southwest Arizona heat, and the boxes regularly fail when air conditioning is switched off in unoccupied rooms.

“We’ve had over 100 of them replaced probably in the last I don’t how many months,” she said. “It’s a box that if the room isn’t rented every night it becomes deactivated.”

Those paying to stay in the motel are not happy to reach their rooms and find the television isn’t working either.

“We’ve lost thousands of dollars with people that would move out because of no TV in their room,” Peach said. “It comes and it will say dial an 800 number or something. But you know the guest. They are paying a certain amount for the room and they’re not going to call.”

KYMA-TV in Yuma, Ariz. reports Charter told this hotel owner her cable boxes were not working because they are not being kept air-conditioned. (2:29)

Spectrum ignores her complaints, she claims, transferring her from call center to call center in search of a solution. She finally took her complaint to the FCC, something she does not think should be required after paying the company $1,600 a month for cable television.

In response, Spectrum blamed the lack of air conditioning for its box failures, in addition to the “relocation of the digital adapters by hotel staff, which are dedicated to a particular room on the account.”

In other words, if you move equipment between hotel rooms, Spectrum claims that equipment will deauthorize. Spectrum effectively wants motel guests placed in rooms where their cable equipment is still functioning, preferably where air conditioning is left running.

“If you’ve been driving all day and you get in your pajamas and you’re ready for bed and you’re watching TV and the TV doesn’t work, do you want to move to another room without complaining? No, nobody does,” said Peach.

In upstate New York, heat isn’t a significant problem, but having a bulk account representative in Rochester, 2.5 hours away by car from Binghamton is. The representative did not understand Binghamton and Endwell are two different communities about seven miles apart.

“This whole thing could have been avoided,” Keenan said. He called the New York Public Service Commission to complain and within a day multiple Spectrum trucks arrived loaded with set-top boxes — one per residence, potentially finally resolving the dispute, but not the bad feelings that emerged as a result.

“Time Warner Cable was saying ‘we need our customers,’” Keenan said. “The experience I have had with Spectrum is Spectrum is saying ‘you need me.’”

WICZ-TV follows up the next day with this report explaining why it is important to stay wary of cable companies offering long contracts. (1:09)