Can Broadcasters Have Their Cake — And Eat It Too?
The National Association of Broadcasters (NAB) is back at the FCC with a full plate of regulatory requests — and this time, it wants the whole cake, too.
In a recent filing, the NAB urged the FCC to move quickly on a sweeping wish list: a mandate to convert all over-the-air broadcasting to the ATSC 3.0 transmission standard (also known as "NextGen TV"), an end to the burdensome requirement to simulcast in the current ATSC 1.0 format during the transition, a rollback of ownership rules to pave the way for further consolidation, and — perhaps most notably — continued protection for the retransmission consent regime, the system that allows broadcasters to demand payment from cable and satellite providers (MVPDs) for carrying their local signals.
ATSC 3.0/NextGen TV Upside Is Clear
Let’s be clear: ATSC 3.0 offers broadcasters an exciting and potentially lucrative future. The new standard allows for higher picture quality, improved mobile reception, and — perhaps most importantly for station owners — the ability to carve out new revenue streams through targeted advertising, datacasting, subscription-based services, and more. It transforms a TV signal from a one-way broadcast into a flexible, IP-based platform that resembles the internet more than traditional television.
The NAB argues that this transition is vital to keep local broadcasters competitive. They're not wrong about the potential benefits of 3.0 — but the FCC should think twice before giving the industry a one-sided deal. If broadcasters are going to gain so much from a 3.0 mandate, they must give something meaningful back. And that “give” should come in the form of revisiting retransmission consent.
Retrans fees have become the lifeblood of many station groups. According to S&P Global Market Intelligence, U.S. broadcasters earned an estimated $12.3 billion in retransmission revenue in 2023, up from just $200 million in 2006 — a more than 60-fold increase over less than two decades. In some cases, retrans now accounts for more than half of a station’s total revenue, particularly for large broadcast groups like Nexstar and Sinclair.
Retrans: A Broken Relic
This windfall was originally justified as a means to support local journalism and ensure that free, over-the-air television retained its value in a world dominated by cable bundles. But in practice, retrans has helped supercharge consolidation, driven up consumer cable bills — by as much as $15 to $20 per month, according to estimates from the American Television Alliance — and contributed to a growing number of blackouts when negotiations between broadcasters and pay-TV providers go south.
As broadcasters eye a future with expanded revenue streams enabled by ATSC 3.0 — including direct-to-consumer subscription options and data-driven ad targeting — it’s fair to ask: should this industry still be propped up by a regulatory framework designed for the analog era?
The NAB’s position seems to be: yes, and more, please.
To be fair, the NAB is not explicitly asking the FCC to strengthen retransmission consent — but it is asking to maintain its protections while gaining significant new commercial advantages via a 3.0 mandate. This reveals a broader tension: broadcasters want to be seen as embattled public service providers when it suits their case for regulatory protection, but as cutting-edge, multi-platform media companies when it’s time to pitch Wall Street and advertisers.
An Untenable Dichotomy
The FCC should not let them have it both ways. If broadcasters get the green light for a 3.0-only world — and the relaxed ownership rules that would let the largest groups further entrench their dominance — the agency must then consider sunsetting or reforming the current retransmission consent regime.
This would not be an anti-broadcaster stance. Quite the opposite: it would acknowledge that broadcasters are finally on the cusp of the long-promised evolution. ATSC 3.0 could allow local stations to deliver advanced emergency alerts to mobile phones, provide distance learning services, transmit encrypted subscription content, and even sell bandwidth to third-party data customers. According to Deloitte, U.S. broadcasters could generate over $10 billion annually in new ATSC 3.0-related revenues by 2030 from data services and interactive content.
These are real business opportunities — and public interest benefits — that go far beyond retrans.
But regulators should not permit broadcasters to double-dip. If the industry gets a path to 3.0 and all the revenue opportunities that come with it, then retrans — an artifact of a different technological and business model — should be gradually phased out or meaningfully restructured.
Innovation Or Protectionism - Pick One
Some industry players may balk at that notion, citing the still-limited reach of 3.0-compatible receivers. And that’s a fair point — as of early 2024, fewer than 25% of new TV sets sold in the U.S. come equipped with ATSC 3.0 tuners, according to the Consumer Technology Association. But that number is rising, and a federal mandate would likely accelerate both device availability and market adoption.
Meanwhile, broadcasters themselves are enjoying historically strong financial tailwinds. In 2024, political advertising on local TV is projected to exceed $10 billion, according to AdImpact — a record high. This influx of cash — layered on top of retrans and growing digital revenue — shows that the industry is not in crisis, but at a crossroads.
At some point, the trade-offs must be made explicit. Broadcasters cannot be both innovators and wards of the state. If the FCC is going to help catalyze a transition to ATSC 3.0 — which it arguably should — then it must also consider what legacy privileges, like retrans, can be scaled back in a modernized regulatory framework.
In short, the NAB has made its pitch. The FCC should answer with a simple but fair proposition: yes to innovation — but not without reform. You can’t have your cake and eat it too.
Local News To Peruse
FCC’s Carr Calls Station Ownership Caps ‘Arcane’ And ‘Artificial‘ - George Winslow [TVTech]
Local NPR, PBS Stations Raise Money, Plan Cost Cuts After Trump Order - Joe Flint [Wall Street Journal]
“The Local” Aims To Reinvent TV News In Four States, And Beyond - Corey Hutchins [NiemanLab]
A TV Meteorologist Builds An AI Avatar That Creates Its Own Forecasts - Michael Depp [TVNewsCheck]
New York Wants Per-Channel Pay TV Agreements - Matthew Keys [TheDesk.net]
FCC Seeks Comments On LPTV Adoption Of 5G Broadcasting - George Winslow [TVTech]
