Fee fight leaves viewers wanting

[Scott Greczkowski]

Fee fight leaves Dish Network viewers wanting
SUBSCRIBERS LOSE ACCESS TO VIACOM-OWNED KPIX, MTV
By Sam Diaz
Mercury News
http://www.mercurynews.com/mld/mercurynews/news/8149649.htm

A dispute that left hundreds of thousands of Dish Network subscribers in the Bay Area unable to watch KPIX Channel 5, MTV, Nickelodeon and other stations could lead to a different type of March Madness if the matter isn't settled before the annual NCAA basketball tournament starts next week.

Early Tuesday morning, the satellite TV provider stopped carrying stations owned by media giant Viacom.

EchoStar, owner of Dish Network, is refusing Viacom's request for higher fees, and the result is that more than 9 million subscribers nationwide now have no access to ``SpongeBob SquarePants'' and ``The Real World.'' A portion of them also might not be able to watch CBS programming such as ``Survivor'' or -- if the dispute lasts -- the NCAA tournament, which starts March 18.

The battle has plenty to do with money, but some insiders say it's also the manifestation of an ongoing struggle between content providers -- Viacom, in this case -- and content distributors such as cable and satellite companies.

Viacom asked for the higher fees when its contract with EchoStar expired Dec. 31. A federal judge issued a restraining order to keep CBS and other channels on the Dish Network system for the Super Bowl and allow more time to negotiate.

In a statement released Tuesday, Viacom said Echo- Star is unwilling to pay an extra 6 cents per month per subscriber for its programming. Littleton, Colo.-based Echo- Star, also in a statement, said Viacom is ``demanding rate increases nearly four times the rate of inflation for various cable channels, amounting to hundreds of millions of dollars in fees.''

Neither company would comment on specifics of the dispute. It was unclear Tuesday how long the dispute might last, but one analyst told Bloomberg News he thought it might be several weeks.

When the restraining order expired early Tuesday morning, most of Dish Network's subscribers lost MTV, Nickelodeon and several other channels. The feed for CBS -- which broadcasts the NCAA tournament -- was lost only in markets where Viacom owns the local station, including San Francisco.

Read the rest at http://www.mercurynews.com/mld/mercurynews/news/8149649.htm

 

[rad]

Scott, here's a link from the Chicago Tribune (free registration required):
http://www.chicagotribune.com/business/chi-0403100293mar10,1,6691250.story

Some of the high/low points are:

"We are willing to negotiate as soon as Viacom is willing to be reasonable," said EchoStar spokesman Steve Caulk, but he said he knew of no plans to resume talks.



Sumner Redstone controls Viacom, and Charles Ergen controls EchoStar. Both are regarded as tough and aggressive businessmen.

"They are very smart guys, but they are very litigious and stubborn, and they both have voting control of those companies," said Matthew Harrigan, an analyst with Janco Partners, an investment banking firm.

 

[Chris Walker]

Scott, here's a link from the Chicago Tribune (free registration required):
http://www.chicagotribune.com/business/chi-0403100293mar10,1,6691250.story

Some of the high/low points are:

"We are willing to negotiate as soon as Viacom is willing to be reasonable," said EchoStar spokesman Steve Caulk, but he said he knew of no plans to resume talks.



Sumner Redstone controls Viacom, and Charles Ergen controls EchoStar. Both are regarded as tough and aggressive businessmen.

"They are very smart guys, but they are very litigious and stubborn, and they both have voting control of those companies," said Matthew Harrigan, an analyst with Janco Partners, an investment banking firm.

That's an old article. Latest news says they are mending fences and deal is very very close.

 

[Stargazer]

Well Viacom could look at it this way, the additional money that they wanted for the contracts that got renewed lately could have netted them less without having a deal with Dish at all, or at least no increase, for the amount they get from those that distribute their programming. On top of that they would have less viewers which causes lower ratings which in return causes less money they would receive from advertisers so they would lose money there as well.

Perhaps Viacom should think of it this way, its better for them to get something (what Dish is willing to pay them) than nothing at all but I just dont think they see it this way. They think that Dish will be desperate to have their channels that they HAVE to have them but if Dish can prove them wrong then this could make Viacom think twice. Does Viacom really think that they can get enough people to switch and go from Dish to another provider so that they can get the higher rate? More than likely most of Dish's subscribers are not going to switch over to another provider as a result of the Viacom channels being missing.