Pro TV notified CNA that it leaves the must-carry list starting July 23 mentioned date, cable companies must ask Pro TV permission to carry the channel and pay to be able to offer it to the subscribers.
“We ask you to order a public announcement on dropping the must carry status for the programs service”, Pro TV mentions, in a document sent to CNA
What’s Pro TV’s reasons for the move?
“Our decision is motivated by the fact that Pro TV is undergoing a process of modifying its distribution strategy in order to switch to terrestrial digital broadcasting and implementing digital multimedia services at national level, following a concept that will help us minimize the impact of digitalization over or business. The changes in distribution method will not affect the content in any way”, Pro TV mentions, in its document.
Pro TV was topping the list of must carry channels free for retransmission, with the highest average audience.
At CNA, Pro TV’s representatives insured that, even with the decision to leave the must carry list, the viewers “will continue to see the channel in the same conditions” in the next period; this means Pro TV’s signal won’t be stopped while the channel is negotiating the new conditions with the cable operators.
“The viewer won’t be affected in any way, we have contracts running and they will produce effects until the end and negotiations will take place afterwards”, Elena Petrea, Executive Director ProTV, said.
Contacted by Paginademedia.ro, Maria Apostol, PR Manager Pro TV, said that, for the moment, Romanians won’t be affected by the announced measure and will be able to see Pro TV. With the new conditions, were new contracts made? “I decline to make any comments”, Pro TV’s official said.
“Challenging moments demand daring measures: increasing the price for advertisers and of the fees for cable operators”
That is what Adrian Sarbu, CME manager, was saying in the start of the year, in a press release that presented CME’s financial results for 2012.
“As we showed in November, our performances this year reflect the difficult situation the media market confronted in 2012. Challenging moments demand daring measures: increasing the advertising prices and of the taxes for cable operators (…) We plan restructuring the operational model, in order to reduce costs and improve the liquidity part”
The income of the company that operates Pro TV channels in Romania were, in 2012, of $134M, according to data released by CME in February 2013. The numbers went down compared with 2011, when Pro TV had, in Romania, income of $ 159.3M. Pro TV’s intentions with companies that retransmit TV stations were visible in the end of last year.
Following a misunderstanding with Dolce (Romtelecom’s DTH operator) related to the fee demanded by Pro TV, Pro’s channel were, for a period, out of Dolce’s programs schedule.
Later, Dolce and Pro TV reached an agreement and the channels were reintroduced in the schedule and accessible again to the subscribers. To note is that must carry principle doesn’t apply to DTH satellite operators
How much cable operators pay for Pro TV? The starting price is Euro 1/subscriber/month
After Pro TV left the must carry list, cable operators will pay for channel’s retransmission.
CME operates in Romania ProTV, Acasă TV, Acasă Gold, Pro Cinema, Sport.ro, ProTV Interantional and MTV.
The start price in the negotiations with the cable operators is Euro 1 per subscriber per month for the entire package of channels, according to Pro TV’s website. The mentioned price is valid for 4 years starting February 1st 2014
Cable operators, number of subscribers and discounts
RCS&RDS has 3M subscribers to TV services, 1.2M to satellite TV and 1.8M subscribers CATV.
Romtelecom has around 1,22M subscribers for TV services (DTH, IPTV and cable), while UPC has around 1.2M subscribers.
The discounts to be applied is 44.44% for companies with 1-1,5M subscribers and 61.11% for the ones with 2.5 -3M subscribers.
The discounts offered by Pro TV vary from 0% (if the distributor has up to 300,000 subscribers) to 66.66% (over 3M subscribers).
Competition Council about Pro TV’s decision; It will generate major shifts on the TV market
The immediate effect of Pro TV’s decision to demand retransmission fees to the cable operators can be an increase of the cable TV subscriptions, stated, for HotNews.ro, Mircea Valentin, VP Romanian Competition Council.
An alternative that could diminish this impact would be if Pro TV’s channels will be included in a special package, with subscribers being free to get them separately.
“Pro TV’s decision will generate major shifts on the market. Must-carry is a benefit of the audiovisual law and, of course, Pro TV can drop it, with the consequence that cable operators won’t be obliged to relay the station anymore and the relations between the channel and cable operators will be exclusively commercial”, Valentin said.
Managing the relations between cable operators and TVs via direct agreements could offer a more correct image of the market value each TV has, Valentin thinks
Translation provided by AdHuggerCarmen Maria Andronache carmenpaginademedia.ro