DirecTV CEO Takes His Fox Dispute To The Web
- by David Goetzl @dgoetzl, October 28, 2011
CEOs generally don’t like to muddy their hands with public involvement in difficult carriage disputes. Instead, they call on other executives and
ad campaigns to make their case. Yet, DirecTV chief Mike White began appearing in a Web video Friday that resembles a political ad; he has a calm and engaging demeanor, while using some verbal sleight
of hand.
He starts with: “Hi, I’m Mike White. CEO of DirecTV.”
Then: “Right now, we’re talking to News Corp., the company that owns Fox, about how much they want to charge you for some of their regional sports and cable channels. As it stands right now, News Corp. wants you to pay 40% more for the exact same channels you watch today. We believe this price increase is entirely too much.”
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Actually, if the 40% figure is correct, News Corp. isn't charging users directly; it wants DirecTV to pay more for the same channels. However, there is no assurance that DirecTV will not raise a customer’s bill commensurately, hence the threatened 40% hike.
If a new deal isn’t reached by Nov. 1, FX, National Geographic Channel and a run of regional sports networks with the NHL (and maybe the NBA post-lockout) could be removed from DirecTV.
Fox has said that DirecTV has pursued “bad faith tactics over meaningful negotiation,” while saying it would keep the channels on DirecTV at the same current price as negotiations continue.
A Fox spokesman has characterized DirecTV’s claim about a 40% increase in carriage fees as “ridiculous.”
In the ad, White says DirecTV already pays News Corp. nearly $1 billion for carriage of the networks and the company has “no problem compensating them reasonably.” Also, he says local Fox stations and the Fox News Channel are not part of the current standoff.
These negotiations can be nasty and when they don’t go smoothly they tend to directly effect the most important group involved, the customers. When DISH Network went through similar negotiations last year DISH was able to resolve the situation and land a long term agreement with FOX. By doing so they not only kept the programming that many of their subscribers enjoy, but they were able to do so with out raising the cost for customers. From the sounds of it, Direct may not be able to offer the same low cost for their subscribers. I only hope that things work out for their subscribers as quickly as possible.
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