Later this year, our industry will begin to re-negotiate retransmission consent agreements with broadcast stations for those following the traditional 3-year cycle. The 2023 “retrans” cycle is sure to present many of the challenges of the past. Year-end is the most wonderful time of the year – unless you are negotiating retransmission consent renewals. Before you resort to hiding under your bed, we want to address some common myths surrounding this process.
Retrans Myth #1: Negotiating wastes time because the stations have more clout.
This is the big one! Sure, it is true that large media companies have an advantage. But their initial offer is always going to be overpriced.
There is always room for negotiation which will keep more money in your pocket. Leverage has negotiated hundreds of deals over the years, and we have never failed to get movement on the rate.
Retrans Myth #2: It is not worth my time and hassle. Any concessions I gain in the negotiation won’t be that significant, right!?
By the numbers: For an operator that has 5,000 video customers, getting a rate that is just a nickel lower than the initial offer is worth $9,000 over a typical three-year period. Trim a dime each month from the overall economics, and you’re at nearly $20,000 in savings in that same three-year period.
- In addition, do not forget to negotiate items such as how many multicasts you must carry. Particularly if there is a retransmission consent fee associated with each multicast, negotiating a limit to the number of multicasts required to be carried can represent additional savings.
Retrans Myth #3: There’s no way to get them to change contract terms that are disadvantageous to us!
How it works: In our experience, operators negotiating independently with a focus on rates alone often overlook non-economic terms.
- While rates are important, operators can be negatively impacted by ignoring other non-economic terms that can and should be negotiated. We have a standard checklist of items we seek to modify or remove from many initial contract offers.
Of note: It is important to identify areas when compliance may be challenging or impossible and then address those in the negotiation. Important considerations to address:
- Are you still operating a bandwidth-constrained system?
- What ATSC 3.0 terms are feasible for you?
Retrans Myth #4: We got this! There’s no reason to get help from an outside firm.
Why experience matters: We have negotiated hundreds of deals with nearly all ownership groups. We know their style and areas where they are flexible.
- RELATIONSHIPS – We know the people doing the negotiations “on behalf” of the broadcast stations. That affiliation provides a high level of cooperation and helps to streamline the negotiation. If you find yourself in a tight spot, our relationships can be very helpful in resolving these matters.
- PERSPECTIVE – Since we’re doing dozens of negotiations each cycle, we have developed a good understanding of what “market” rates are. While we would never share specifics of another client’s negotiation; we can speak in general terms about what your expectations should be.
RESULTS – Our affordable negotiation fees put real wins on the board for our clients. Sometimes that may look like a lower rate. That’s a win! Sometimes we get a BIG win. Just this year, we negotiated a deal that resulted in a decrease in our client’s monthly expenditure. Not a small increase. Not flat rates. But a significant decrease!
Retrans Fact: Myths will cost you!
The bottom line: Don’t fall victim to these myths! Let’s talk soon about how the Leverage Broadband Strategies team can take the hassle out of this year’s retransmission consent renewals. You have an objective, and we’ll deliver the key results!
Through June, we are accepting new clients who need retransmission consent management and negotiation expertise and offering discounts to those who engage with us this month. Get in touch with us here.