Comcast Subscribers Pay $1.9 Billion a Year for Free OTA Channels

Comcast Subscribers Are Paying Up To $1.9 Billion a Year for Over-the-Air Channels They Can Get Free

Comcast’s “Broadcast TV Fee” has long been a source of controversy, even leading to a class-action lawsuit. Tens of millions of subscribers are paying the cable company (and to be fair, many other cable companies charge this fee as well) additional fees every month all for the privilege of watching local channels — like FOX, NBC, ABC, and CBS — that are available for free with an antenna.

Many critics argue that broadcast TV fees are nothing more than a way for cable companies to shake customers down for more money. Just another one of their many hidden fees — a billing trick. And what a profitable trick it is. We calculated that Comcast is raking in as much as $1.9 billion a year from its broadcast TV fees.

Here’s how we arrived at that number.

Recent estimates show that Comcast currently has about 22,508,000 customers subscribed to its cable TV service. As of January 1, 2017, Comcast raised its “Broadcast TV Fee” from $5 a month to $7 a month. And as you can see below, local broadcast channels are included in every TV package Comcast offers.

With these numbers in hand, it’s simple math. 22,508,000 subscribers paying $7 a month for broadcast channels comes out to around $157.6 million in monthly revenue for Comcast. Over the course of a year, Comcast gets about $1.9 billion from its Broadcast TV Fee. Again, these are channels you can get for free over the air with an antenna.

What About Those Who Can’t Get Antenna Reception?

Of course, there is an assumption with the $1.9 billion figure, and that is that all Comcast subscribers would be able to pick up those channels free if they had an antenna. However, that’s likely not the case.

While there’s no way to know exactly how many Americans are able to get good enough antenna reception to pick up their local channels, there’s enough data available to make some reasonable estimates.

We reached out to Mohu, an antenna manufacturer, to see if they could help us determine the percentage of people in the US who can pick up their local channels with an antenna. Here’s what a representative from the company said:

Per US Census data, 80.7% of Americans live in Urban Areas, where broadcast TV towers tend to be located. That translates roughly to 250 million Americans living in Urban Areas. Comparing this to our own Zip Code analysis data of more than 30,000 US Zip Codes within 40 miles of TV towers and matching that to corresponding US Census Zip Code populations, that number of people within range of at least one TV transmitter comes closer to 278 million Americans. (Editor’s addition: that’s roughly 89% of Americans within range of a transmitter)

Now, it’s worth keeping in mind that even if you don’t live in an urban area, you may still be able to pick up your local channels with a rooftop or attic antenna. And of course, just because you live in an urban area near a broadcast tower doesn’t guarantee you’ll get a clear signal as there could be interference from tall buildings in some cases.

However, putting aside these cases that are exceptions, a cautious estimate is that 80% of people can pick up their major local channels using an antenna. With that in mind, if you assume that 80% of Comcast subscribers could get their local broadcast channels free with an antenna, that’s still $1.5 billion each year that the cable company is getting by charging subscribers for channels they can get for free.

Any way you slice it, that’s a whole lot of money being thrown away.