Thursday, December 31, 2009

Time Warner Cable may drop Fox stations

Published: December 30, 2009
The News Corporation said on Wednesday that it looked doubtful that it would sign a new distribution contract with Time Warner Cable by Thursday night. This has increased the likelihood that its Fox stations will be removed from cable lineups in millions of homes.

The News Corporation’s president, Chase Carey, declined an offer by Time Warner Cable to enter binding arbitration. The companies are fighting over how much the cable operator should pay Fox stations for the right to retransmit their shows, sporting events and local newscasts.
Fox is demanding about a dollar for each cable subscriber each month, which analysts say could set a precedent for broadcasters that want more money from cable and satellite operators.

The contracts expires midnight Dec. 31. Fox could then take its signal off Time Warner Cable systems in New York, Los Angeles, Dallas and other cities.

Time Warner Cable representatives arrived in Los Angeles early this week for the Fox talks.  The renewal deal that also will affect several cable channels, including FX and the Speed Channel.

The companies traded barbs on Wednesday after the cable operator responded to a letter from Senator John Kerry, Democrat of Massachusetts, and offered to extend talks into 2010.
Hours later, Mr. Carey said that the News Corporation would not provide an extension because it had been “trying since the summer to negotiate a fair deal.”

“At this time, it looks like we will not reach an agreement, and our channels may very well go off the air in Time Warner Cable systems,” Mr. Carey told employees.

“We deeply regret that millions of Fox customers will be deprived of our programming, but we need to receive fair compensation from Time Warner Cable to go forward with them,” he said.

Mr. Kerry said Wednesday night that he would press the Federal Communications Commission to intervene in the dispute.

Negotiations between programmers and distributors are often prolonged and painful, but they rarely occur in public the way the feud between Fox and Time Warner Cable has.

Each company has mounted a campaign for public support, with print ads and petitions. Fox says that it deserves to be paid more for its programming, while Time Warner Cable says Fox’s demands are excessive.

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