Time Warner Cable and News Corp's Fox Networks agreed to a brief extension of their current carriage contract on Thursday to avoid a blackout that would have prevented 13 million US homes from seeing TV shows like "The Simpsons" and college and NFL football games. The two sides continued to negotiate for a longer-term deal into the early hours of Friday morning.
Time Warner Cable also agreed a short extension with Scripps Networks Interactive's Food Network. But another cable operator, Cablevision Systems Corp, which has 3 million subscribers in the New York area, said early on Friday it had been unable to reach a new carriage agreement with Scripps and dropped both Food Network and HGTV.
It said in a statement it had "no expectations" of carrying Scripps programming again. The last-minute negotiations over how much cable operators pay networks to distribute their programming are often contentious. In 2008 Time Warner Cable went to the wire with Viacom Inc on New Year's eve in a similar dispute.
In the last 12 months talks between cable operators and program providers have become even more tense. Programmers have been seeking better affiliate fees as they have seen advertising revenue hurt by the US economic downturn and remain uncertain about the future of TV advertising as more marketers turn to the Web.
The short-term extension between Fox and Time Warner Cable comes after a months-long dispute over how much the second largest US cable company should pay for the right to deliver the free-to-air Fox broadcast network to its subscribers in major cities like New York and Los Angeles.
News Corp, which is controlled by media mogul Rupert Murdoch, has been targeting around $1 a month per subscriber, a sum which Time Warner Cable has described as "unreasonable". Time Warner Cable executives have privately pointed to deals with other smaller broadcasters for around 20-25 cents a subscriber. The dispute has played out in the press and aggressive marketing campaigns from both companies seeking support from the affected subscribers.
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