Still, in as little as five years, broadcast networks will still morph into looking like cable networks, at least by one financial measure.
Some $25 billion a year in advertising revenues currently goes into the coffers of the five big English-language broadcast networks. By 2019, those networks are expected to grab an additional $8 billion coming from retransmission fees – or 24% of broadcast networks’ total revenues.
Marci Ryvicker, managing director of equity research at Wells Fargo, says total retransmission revenues could hit nearly $12 billion by 2019, with the big broadcast networks -- through their station affiliates -- expected to grab 65% of that total.
For decades, cable networks have counted on a 50/50 financial model, with around half of their yearly revenue coming from advertising and the other half coming from subscriber fees, which distributors pay to carry the networks.
With broadcast networks heading toward a 75/25 advertising-to-retransmission revenue split in five years, they say there is a lot more to do.
ESPN now tops all networks -- cable and broadcast -- with a fee of $5 per subscriber per month. Broadcast networks, which now get around $1 to $2, say that if carriage fees were based just on viewership, they would get more money than ESPN.
But broadcast ratings continue to erode, as they have done for a couple of decades.
In five years time, will CBS and other broadcasters be able to make the claim they are the most viewed networks, demanding even higher retransmission dollars?