Sports Fans Ensnared In Fox, Cablevision Rate Duel

NEW YORK (AP) — For the fourth time this year, Cablevision’s 3 million subscribers in New York and Philadelphia are at the mercy of one of its disputes with networks, and caught in the middle are sports fans who missed playoff baseball and Sunday’s New York Giants game.

Negotiators for Cablevision and Fox parent News Corp. failed to reach an agreement over rates Sunday, more than a day after their deal expired amid negotiations for a new one. Fox pulled its channels and programming while the two sides discuss how much Cablevision will pay to carry them.

The two sides will meet again Monday, Fox spokesman Scott Grogin said. “House,” the drama that’s among Fox’s highest-rated shows, airs Monday night at 8 p.m. EDT.

Cablevision spokesman Charles Schueler reiterated that arbitration would be “the fastest and fairest way to return Fox programming to Cablevision customers.”

Fox 5 and My9 in New York and Fox29 in Philadelphia were dark, as well as cable channels Fox Business Network, NatGeo Wild and Fox Deportes.

“This is ridiculous!” said Kevin Ryan, owner of Denny’s Bar, a family business in Brooklyn’s Kensington neighborhood. “I’m relying on people to come in who are Giants fans — and they’re walking out, even though I pay for the football package.”

He blames his debacle on “typical billionaire behavior, against the small businessman like me; and regular, everyday people get caught in the middle.”

Ryan said he expected to lose “a good amount of money over three big events”: the Giants’ 28-20 win over Detroit and the first two games of baseball’s National League Championship Series between San Francisco and Philadelphia.

Cablevision subscribers have been victims of multiple blackouts this year. In March, customers lost their ABC station in New York in the hours leading up to the Oscars. Viewers missed the first 15 minutes of the awards show before Cablevision and Walt Disney Co. reached a tentative deal.

Scripps Networks Interactive Inc.’s Food Network and HGTV also went dark for three weeks in a similar dispute. Separately, Cablevision’s Rainbow Media unit played hardball this summer with AT&T Inc. in fee negotiations over three channels: AMC, IFC and WE tv. That threatened customers’ ability to watch the season premiere of AMC’s “Mad Men.”

Other industry standoffs this year have pitted Time Warner Cable Inc. against News Corp.’s Fox channels, which threatened the college bowl season and new episodes of “The Simpsons,” and Mediacom Communications Corp. against Sinclair Broadcasting Group.

The latest dispute is another example of how networks are struggling to find profits as advertising revenue dwindles and programming costs grow. Networks are transmitted freely over the airwaves, but expensive event programming has increasingly led the companies behind them to demand fees from cable TV and satellite operators for retransmitting those signals.

Networks claim that cable companies charge customers hefty sums each month — about $18 — for basic broadcast signals but don’t pass on enough payment to networks. Most broadcasters get a fee — say, $1 per cable subscriber — for allowing pay-TV providers to carry the channels on their lineups.

As the recession forced businesses to cut budgets for TV advertising — traditionally the main source of revenue at broadcast stations — television networks started asking for a higher fee per subscriber. The cable TV companies have resisted, saying higher fees get passed along to customers in the form of higher cable bills.

Where does that leave customers hoping to watch big sporting events and their favorite shows? Some analysts say that the more signals get pulled, with customers hurt, the more the industry is taking the risk that government will intervene.

“I’m not big on government intervention — they should go to binding arbitration and get a fair rate for everybody,” said Tony Bastone, manager of Yankee Tavern near Yankee Stadium. “This is just flat-out greed; they can’t make money on ads, so they’re trying to make it through subscribers.”

He said his bar drew customers Sunday because the football game was on DirecTV.

A coalition of pay-TV providers — including Cablevision, Time Warner Cable, DirecTV Inc., Dish Network Corp. and Verizon Communications Inc. — have seized on these incidents to ask the FCC to rewrite the rules governing so-called retransmission consent negotiations. They want the agency to prohibit broadcasters from pulling signals during negotiations or before popular events, and to mandate binding arbitration in disputes.

Cablevision has called on News Corp. to put Fox5 and My9 back on Cablevision immediately and submit to binding arbitration under a neutral third party. It says Fox is making “outrageous fee demands.” Cablevision says it pays $70 million a year for access to 12 Fox channels, including those in dispute, and that News Corp. is now asking for more than $150 million a year for the same programming.

But Fox has blamed Cablevision for the impasse, saying the two remain “far apart.” It rejected the call for arbitration, saying the process would “reward Cablevision for refusing to negotiate fairly.” Fox has said Cablevision is “hypocritical” because it pays more for two of its sister company channels, MSG and MSG Plus, than it does for all 12 Fox channels. MSG and MSG Plus are owned by Madison Square Garden Inc., which like Cablevision is controlled by the Dolan family.

The FCC has encouraged the two parties to agree to binding arbitration.

In a separate dispute with satellite TV company Dish Network Corp., Fox cut access on Oct. 1 to 19 regional sports networks, FX and the National Geographic Channel for some 14.3 million Dish subscribers. That fight foreshadows more tough negotiations, as the deal for Fox broadcast signals on Dish expires Oct. 31.

(Copyright 2010 by The Associated Press. All Rights Reserved.)

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  • dabooch

    When the Yankee games weren’t broad-casted in 1994 I lost interest until 2003. Excellent way of killing a habit.

  • Allen E.

    Don’t kid yourslef. Fox can (and will) do this to any TV company if their demands are not met. And I for one do not want to pay more each month for the same programming, just to put more $ into Fox’s hand. Good for Cablevision and Dish for fighting the battle for their customers.

  • Charlie

    I hope the sponsors running commercials on Fox5 and my9 are getting refunds since they are down millions of viewers thatnks to Newscorp. Time for a digital antenna. Theres no need to pay for TV anymore. Local is free and digital over the air and everything else you can get online the next day and movies from netflix, cheap.

  • richard

    I thought the point of ads was to pay for the price of broadcasting the signal..Now with that said i do have cable and went through this with brighthouse networks and fox here in orlando florida,they were going to blackout the final bcs game with tim other words black mail there custormers into getting it for them….it was settled just before the game was to take place and now we all pay higher cable bills.
    I really wish the fcc would step in and hevly start setting regulations on these companys so the public is not to sufer from either one of them,as far as im concerned i wish fox would get dumped and than the cable companies be forced by the fcc to lower evceryones bill..that way they both lose,as far as sports go’s the affiliate should be fined if the cable company is the only soure for that transmition.

    • Janice

      Everyone should investigate the link between Direct TV (liberty media) and News Corp. They are definitely linked. Direct TV will benefit from this unfair rate hike with Cable Vision and Dish Network. The government should intervene.!!!!

  • Cable Guy

    What network will be next? Stay tuned

    • richard

      The next network will be abc/espn…there contracts are comming up shortly.

  • djnorm

    I’m just glad it’s Fox. I never watch them anyway on principle. As for the bar owners whining, get an antenna and get it for free and quit complaining.

  • Dean

    I’m glad Manhattan is covered by TimeWarner and not Cablevision.

  • Eli51

    If Cablevision customers want to send a message to Cablevision they should cancel their subscription & switch over to Direct TV or Verizion Fios instead.

  • ci120553

    This was the genie that Congress let out of the bottle in 1994, when they allowed broadcast television stations to charge rebroaadcast fees. Why should Cablevision (or any other service provider) pay retransmission fees for something that can, essentially, be obtained by anybody for free with an antenna?

  • zodiac

    Bar owners need to blast cabelvision

  • louisg123

    Hey Dave on LI:

    DirecTV is not a safe haven for future channel disputes. No pay TV company is safe. Dish network, Time Warner & now Cablevision has had problems with FOX. There should indeed be laws put into place that would prevent networks like FOX from doing this kind of nonsense in the future while negotiations are still taking place. Fox should consider the fact that paid advertisers on their networks now have 3.1 million less subscribers watching the commercials they paid for this weekend! Good job Fox!

  • Dave on LI

    The oscars was one thing, but missing the Giants game. That is the last straw. I am leaving Cablevision tomorrow. Directv never has these problems.

  • Glen in NY

    I don’t care that they wage war in public… What I do care about is the lack of notice provided by Cablevision. There ought to be a law!

    • george

      I am a Cablevision customer, too, and I’m usually not a fan. I blame News Corp on this one, though….Cablevision has been broadcasting warnings for 3 weeks, and has offered to submit to binding arbitration. News Corp is looking to go from 70 million to 150 million, and in this economy, looking to get twice as much for anything is absurd and beyond greedy. Shame on Rupert Murdoch. I’ll never buy anything he sells again. They are despicably wrong on this one.

  • Steve in NJ

    No matter what agreement is reached we will pay for it. Not Cablevision. You can be sure rates will go up. I am going shopping for a digital roof antenna. I am sick of paying for all this programming we don’t need.

    • richard

      Everyone should look into the new apple tv.

  • janet petronella

    we are cablevision customers here in westchester,i cant see what the big deal is,put up or shut up.kiss and make up.please!

  • oldschool

    The line must be drawn against network greed and subscriber manipulation. HOLD YOUR GROUND CABLEVISION!

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