Cablevision Sues Viacom Over Unpopular Carriage

by Wayne Friedman, Feb 26, 2013, 2:28 PM

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Cablevision Systems filed an major antitrust lawsuit today against Viacom, saying the big TV network group has forced the Long Island, N.Y.-based cable operator to carry over a dozen smaller networks that customers don't watch.

Cablevision says Viacom's "ancillary" networks include Centric, CMT, MTV Hits, MTV Tr3s, Nick Jr., Nicktoons, Palladia, Teen Nick, VH1 Classic, VH1 Soul, Logo, CMT Pure Country, Nick 2, and MTV Jams.

In a statement, Cablevision said: "Viacom effectively forces Cablevision's customers to pay for and receive little-watched channels in order to get the channels they actually want. Viacom's abuse of its market power is not only illegal, but also prevents Cablevision from delivering the programming that its customers want and that competes with Viacom's less popular channels."

Cablevision says it must take smaller networks in order to secure rights for Viacom's bigger, more popular networks: Nickelodeon, Comedy Central, and MTV. Cablevision says Viacom's eight core networks are: MTV, MTV2, Nickelodeon, VH1, Spike, TV Land, Comedy Central and BET.

The cable operator says Viacom's conduct harms Cablevision and its customers, and charge that it "impairs competition." In addition, other networks are excluded from distribution, "preventing Cablevision from being able to differentiate its services and harming subscribers."

Cablevision's suit alleges that Viacom practices unlawful "block booking" --- tying network sale conditions to a "purchaser's taking of other rights."

The cable operator charges that the compulsory carriage "hurts consumers because they get less for what they pay for video services."

Cablevision is seeking to void its Viacom's December 2012 carriage agreement, a permanent injunction from Viacom's "conditioning carriage," and treble damages and legal fees, among other considerations.

A Viacom statement responded: “At the request of distributors, Viacom and other programmers have long offered discounts to those that agree to provide additional network distribution. Many distributors take advantage of these win-win and pro-consumer arrangements.  Reflecting the highly competitive cable programming business, these arrangements have been upheld by a number of federal courts and on appeal.  Viacom will vigorously defend this transparent attempt by Cablevision to use the courts to renegotiate our existing two month old agreement.”

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