Over-The-Air’s Silver Lining Also Has a Looming Cloud

[Commentary] One of the great things about broadcasting is broadcasting — the over-the-air (OTA) technology that lets anyone, anywhere tune in for free (assuming the proper antenna). OTA gives broadcasters an edge over all cable channels, which are restricted to the subset of TV homes that choose to subscribe to cable or satellite. Because broadcasters reach virtually every TV home, they continue to draw the biggest TV audiences. They remain the favorites of the mass marketers as the returns from the upfront ad dealing will prove once again in the coming weeks.

But as station executives plot strategy for the next 10 years, they need to consider the role that over-the-air broadcasting — especially in the advanced, more potent form contemplated by ATSC 3.0 — will play. In the meantime, they need to find the sweet spot. They need to encourage some cord-cutting so as to maintain a high percentage of OTA-only homes and their advantage over cable channels. At the same time, they don't want the percentage to go so high that it starts really irritating cable and satellite operators and cutting significantly into their retransmission revenue stream.