The dispute reflects television’s changing business model as programming choices continue to expand and advertising revenues plummet, noted David Wertheimer, chief executive of the Entertainment Technology Center at the University of Southern California.
Cable networks have always counted on revenue from both advertising and subscriber fees. So even as ad sales have declined, cable channels have stayed afloat on those fees, which have remained steady according to Wertheimer. But broadcast networks that rely solely on ad revenue are casting about for new sources of revenue, which is likely what’s driving Fox’s bid for higher fees.
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