The carriage battle between Turner Broadcasting System and Cable One is heating up, with the media giant deauthorizing signals for three networks the mid-sized MSO believed it had secured through a separate deal, darkening the entire Turner cable portfolio to its nearly 600,000 video subscribers hours just before the first pitch of the Major League Baseball playoffs.
“Cable ONE has been in negotiations to renew our contract with Turner Network for the past several months and we have made every effort to reach a fair deal,” Cable One CEO Tom Might said in a statement. “However, Turner has demanded an increase of nearly 50% for channels with steadily declining ratings. Since we were unable to reach a fair deal with Turner, we’ve been forced to drop these channels from our channel line-up.”
CableOne had originally thought it had secured three top Turner channels – TBS, TNT and Cartoon Network – through a separate carriage deal through with the National Cable Television Co-operative, a programming and hardware purchasing group for smaller cable operators. But according to representatives from Turner, Cable One was informed that it had lost access to those networks as well.
In a statement, Cable One said it had the right to carry the TBS, TNT and Cartoon through a separate agreement with the NCTC — which the programmer disputes — but that Turner chose to deauthorize those signals as well. In total, Cable One customers have lost access to CNN, CNN Espanol, HLN, Turner Classic Movies, TruTV, Boomerang, TBS, TNT and Cartoon Network.
“Cable One has a valid contract with Turner for TNT, TBS, and the Cartoon Network,” the MSO said in a statement. “However, Turner has chosen to punish our customers by deauthorizing the signals for these channels ensuring that they will no longer receive them. We believe that they have done this in retaliation for us dropping their less popular programming.”
Cable One is the tenth largest MSO in the country, and has a total of 720,000 video, voice and data subscribers in 19 states. The loss of the Turner channels could be a particular blow, as the Major League Baseball playoffs are starting tonight, with the National League Wild Card game between the Cincinnati Reds and the Pittsburgh Pirates scheduled to begin at 8 p.m. The American League Wild Card game pitting the Tampa Bay Rays vs. the Cleveland Indians is scheduled for 8 p.m. Oct. 2.
The MSO added that it is “hopeful that Turner will continue to negotiate in order to reach an equitable agreement for the dropped channels.”
Officials at Turner are insisting that they are merely seeking fair compensation for their content.
“Turner has a long history and well-earned reputation as a fair and reasonable partner to our distributors and we have worked diligently with Cable One to come to a resolution, even offering an extension that expired at noon today,” the company said in a statement. “We are simply asking that Cable One pay the established and accepted rates already in the marketplace for our portfolio and remain willing to discuss a new agreement that recognizes the strength and value of our networks and the popular programming they offer.”
Earlier this month, Time Warner chairman and CEO Jeff Bewkes said at an industry conference that he expected the Turner networks to secure double-digit carriage fee increases through 2016.
CableOne has not been afraid to dig in its heels in carriage negotiations in the past. Back in 2005, the mid-sized MSO was embroiled in a nearly year-long dispute with broadcaster Nexstar Broadcasting over retransmission consent charges.
Cable operators have estimated that programming costs will rise in the double digits this year and next, and have complained loudly to government officials for some kind of rate relief. In a statement, Might said the programming model is broken.
“The historical video subscription business model is in decline and a new video model is taking shape, built on the Internet and consumer choice,” Might said in a statement. “Yet, most cable programmers have chosen to demand unprecedented rate increases in the old model just as it declines. Our customers cannot support these unending, enormous rate increases. More are willing every day to try alternate, less expensive ways, to enjoy video in their homes and on the go.”
Source: Multichannel News, 10/1/13