The National Cable Television Cooperative is a video content buying consortium, made up of hundreds of cable companies, large and small. NCTC has a long history of pooling buying power of its members for expensive video content, lowering per subscriber fees for its members as a result.
NCTC membership brings tremendous advantage to smaller video service providers because the cost of content can make or break a video business case. Large national providers like Comcast hold a huge advantage over smaller operators because of their buying power. The NCTC levels the playing field somewhat, at least as it relates to content costs.
Recently, membership in NCTC has become somewhat controversial. As the competitive landscape heats up, small telcos and municipal utilities are competing with traditional cable companies, and they want in on NCTC as well. Conventional wisdom suggests that NCTC legacy members wouldn’t exactly be thrilled at the prospect of their new competitors gaining the same content cost advantage they enjoy as a result of their NCTC membership (although many of those legacy cable companies are actually owned by telcos). NCTC’s ‘company line’ has always been that they welcome all providers, regardless of their competitive situation, as long as they meet certain criteria. That’s where it gets a little controversial.
BroadbandReports.com points our attention to a brewing fight over this issue. LUS, a Louisiana based municipal utility that offers a triple play bundle, claims their membership application to NCTC is being blocked by their main competitor, Cox. Cox is NCTC’s largest member and a Cox representative sits on NCTC’s board. LUS is none too pleased, and has filed a complaint with the FCC, requesting an expedited response. The dust-up also caused NCTC to file suit against LUS.
This type of charge is no news to some IPTV operators, many of whom claim access to NCTC has also been denied to them. NCTC, a traditionally closed-lip organization, has never offered any official response to these claims. In my communication with them, they’ve always said they’ve never blocked any company from joining because of who they may compete with. But they do admit to a selective admission process, reviewing each applicant individually to ensure they meet NCTC ‘criteria’ before offering membership. That criteria is a ‘gray area’ to say the least. There is also a pretty significant membership fee to join – a fee that some operators claim is an additional barrier to entry.
NCTC even had a moratorium on all new membership a couple years back – a moratorium they tell me has now since been lifted. This controversy has given rise to other sources of content for interested service providers (especially those needing IP video rights), including Telechannel and NRTC.
This latest video content controversy will be an interesting one to watch. Stay tuned.
