Not to Offer?
Negotiating Power
While the largest telephone and cable companies make healthy profit margins on video, those with less
negotiating power don’t. Video never became a cash cow for small providers, and in the last five to 10 years,
making a profit has become even more difficult. Consolidation in the content industry led to enormous
increases in cable programming costs—especially for sports—and in retransmission fees for local broadcasting channels. Carriage requirements also have increased, meaning that providers must carry—and pay for—
ever more channels. As a result, most rural broadband providers barely break even on their video services.
