Carriage Battle: DirecTV Threatens To Pull Fox Cable Networks

by , , Oct 21, 2011, 11:45 AM
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boxingNews Corp.’s Fox group said Thursday that DirecTV has threatened to pull 27 of its networks off its system if a new carriage agreement is niot reached by Nov. 1.

Should that result, it isn’t likely to thrill Congress, which held a hearing late last year largely rooted in Fox pulling several 2010 World Series games off Cablevision.

A statement from Fox says DirecTV sent a proposal on Tuesday afternoon, Oct. 18 -- "They have given us no chance to respond before taking an unnecessarily aggressive posture and going public.  It is disappointing that they have chosen bad faith tactics over meaningful negotiation."

The impasse over carriage fees DirecTV would pay Fox has the satellite operator issuing a statement saying: “They are currently asking our customers to pay 40% more for the exact same Fox channels that they already receive and that's simply unfair and unwarranted. ... We already provide News Corp nearly a billion dollars a year for their channels, and we have no problem continuing to compensate them fairly."

A Fox spokesman characterized DirecTV’s claim about a 40% increase in carriage fees as “ridiculous.”

Fox says the negotiations actually have nothing to do with price, insisting it is keeping the price the same and on the same terms. Fox channels affected would be FX, National Geographic, Speed, Fuel, Fox Movie Channel, Speed, Fuel TV, Fox Soccer and Fox Deportes, and 19 regional sports networks.

DirecTV serves 19.4 million homes and while FX may be in the bulk of them, most networks are in a subset.

The regional sports networks are mostly offered in local markets from Detroit to Los Angeles to Houston. NHL games in markets as passionate as Detroit could be off the air, while NBA games could be too, if the league’s work stoppage isn't resolved.  

The Fox owned-and-operated local stations and Fox News Channel are not part of the dispute.

In further explaining its potential move, DirecTV says:

"After months of making little progress in our talks with News Corp and Fox ... we’ve regrettably reached a point where we will be forced to suspend the channels as soon as Nov. 1 unless News Corp is willing to move toward a more reasonable price increase."

Until a few years ago, DirecTV was controlled by News Corp. and was used as a key outlet to help Fox launch and expand cable networks.

About a year ago, Fox Networks had a similar carriage battle with Dish Network, in which Fox pulled its channels off the satellite service. Fox and its parent, News Corp., were engaged in a dispute with Cablevision in 2010.

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