Fox strikes deal with East Coast cable provider
A feud between two media giants that kept millions of cable TV subscribers in the New York City area from watching Major League Baseball and NFL football ended Saturday evening just in time for Game 3 of the World Series.
News Corp.'s Fox Broadcasting and Cablevision Systems Corp. reached an agreement in principle to return Fox TV stations to Cablevision homes more than two weeks after Fox pulled the plug. At issue were fees that Fox wanted Cablevision to pay to carry the network signal as well as the feeds for cable channels Fox Business Network, Spanish sports channel Fox Deportes and National Geographic Wild.
Although the two sides have reached an accord, that doesn’t mean either was happy with the outcome. In a statement, Cablevision blasted the Federal Communications Commission for not getting involved in the dispute and criticized Fox for heavy-handed demands.
“In the absence of any meaningful action from the FCC, Cablevision has agreed to pay Fox an unfair price for multiple channels of its programming including many in which our customers have little or no interest,” Cablevision said, adding that the company conceded to Fox because “it does not think its customers should any longer be denied the Fox programs they wish to see.”
The nastiness of some of these disputes, which are becoming increasingly frequent as broadcasters increasingly turn to carriage fees from cable operators to make up for an erosion of advertising, has left a bad taste in the mouths of both cable customers and lawmakers.
The two-week blackout, one of the longest in the industry, saw Fox and Cablevision spend millions in advertising attacks and lobbying efforts. Sen. John F. Kerry (D-Mass.) has proposed legislation to give the FCC more clout in these disputes and to ensure that signals don’t get pulled from subscribers until it is clear that both sides have exhausted every avenue to reaching an agreement.
Fox and Cablevision struck their deal one day after Fox reached a similar agreement with satellite broadcaster Dish Network, which was also in a bitter negotiation that left subscribers without more than a dozen Fox cable channels.
Terms of the deal were not disclosed, but Fox was seeking a long-term arrangement that would require Cablevision to pay about 50 cents per subscriber for its Fox TV stations in one year that would gradually increase to a dollar per subscriber every month. Cablevision serves about 3 million customers in New York, New Jersey and Connecticut.
Cablevison said, “Our customers will pay more than they should for Fox programming.”
Fox countered, “These comments should not surprise anyone, and they further confirm that this entire dispute was solely about Cablevision’s misguided efforts to effect regulatory change to their benefit.”
Cablevision argued hard for the FCC to force Fox to accept a third-party mediator to no avail. Several politicians also put pressure on Fox, but the network did not budge, arguing that there was no need for government involvement in a business dispute. When Fox struck a deal with Dish on Friday, it seemed that leverage had shifted to Fox.