By the end of this week, the latest retransmission consent fee impasse to impact a wide swath of the television consumer audience could rear its ugly head.
Should that come to pass, some 26 FOX Networks Group MVPD-distributed and broadcast channels will go dark. As such, the company’s over-the-air FOX stations are at risk of being blocked — by law — from paying subscribers of a direct broadcast satellite (DBS) service provider that’s played a role in many other “blackouts” in recent years.
The potential loss of access to such offerings as FS1, Fox News Channel and the Big Ten Network — in addition to a group of over-the-air stations ranging from WNYW-5 in New York and KTTV-11 in Los Angeles to WOFL-35 in Orlando and WFLD-32 in Chicago — involves DirecTV.
As first reported on Sunday by Deadline and its veteran reporter, Dade Hayes, negotiations are continuing. That said, warning messages of a possible loss of service to DirecTV subscribers began appearing in on-screen crawls. If no fresh retransmission consent accord is signed by 3am Eastern on Saturday (12/3), DirecTV will replace live coverage of the channels with a message not so dissimilar to the following one used in July 2019, when DirecTV and CBS were engaged in a retransmission consent negotiation that failed to prevent a “black out”:
The team at DirecTV, even after its August 2021 split from AT&T, has much practice in adjusting messages such as the one above to suit the broadcast and/or cable channel owner it is presently squabbling with.
Most notably, DirecTV’s current spat is with a shared services partner with close ties to the nation’s largest broadcast TV station owner, Nexstar Media Group. One month ago, 25 television stations licensed to Mission Broadcasting went dark on DirecTV in lieu of a fresh retrans deal.
This follows battles between DirecTV and Cox Media Group, and a notable fight between the owner of DirecTV, AT&T TV NOW and U-Verse against eight groups that have shared services agreements with Sinclair Broadcast Group — the latter of which saw a FCC Media Bureau “good faith” complaint filed at the Commission against Sinclair.
In a statement provided to Streamline Publishing contractor Matthew Keys for his media industry blog TheDesk.net, a Fox spokesperson said it was “committed to reaching a fair agreement with DirecTV for the continued distribution of our networks. Despite our best efforts for months, we regret that DirecTV continues to demand unprecedented special treatment that represents a wholesale change to our long-standing relationship and is out of step with marketplace terms.”
What that “special treatment” may be is likely a sticking point in the negotiations between the two parties.
In its third quarter 2022 earnings report, Fox Corporation shared that affiliate fees charged to cable, satellite and streaming TV services totaled $1.711 billion in revenue, a gain of more than 2.5% from Q3 2021.
And, as is seen at a growing number of broadcast TV station owners, political ad displacement has resulted in retransmission fee revenue coming in higher than ad revenue. For FOX, ad revenue totaled $1.22 billion in Q3 2022. But, of that total, just $191 million was attributed to broadcast TV stations owned by FOX.
Should DirecTV fail to reach a retransmission consent agreement with FOX Networks Group by Midnight PT on Friday, the following stations will be blocked from paying DirecTV subscribers, by law. Federal regulations prohibit a MVPD from bringing a broadcast TV signal to a subscriber without an agreement with the copyright owner — the station owner:
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KCPQ-13 in Seattle
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KDFW-4 in Dallas-Fort Worth
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KMSP-9 in Minneapolis-St. Paul
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KRIV-26 in Houston
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KSAZ-10 in Phoenix
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KTBC-7 in Austin
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KTTV-11 in Los Angeles
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KTVU-2 in San Francisco
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WAGA-5 in Atlanta
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WFLD-32 in Chicago
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WJBK-2 in Detroit
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WITI-6 in Milwaukee
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WNYW-5 in New York
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WOFL-35 in Orlando
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WTTG-5 in Washington, D.C.
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WTVT-13 in Tampa-St. Petersburg
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WTXF-29 in Philadelphia
The FOX TV Stations are run by CEO Jack Abernethy, one of the industry’s most respected leaders. He is ranked No. 1 on RBR+TVBR‘s Broadcast Television’s Best Leaders of 2022. Under Abernethy’s leadership, all of the FOX TV stations have shown considerable growth, in particular with their local news and public affairs programming.
As reported by TheDesk.net, independent and MyNetwork-partner stations owned by Fox would also be blocked from DirecTV viewers. These stations include WRBW-65 in Orlando, WPWR-50 in Chicago, WFTC-9.2 in Minneapolis, WWOR-9 in the New York market, KUTP-45 in Phoenix, KCOP-13 in Los Angeles, KICU-36 in San Francisco, and WDCA-20 in Washington, D.C.
In a statement to TheDesk.net, a DirecTV spokesperson said a future deal “depends solely on Fox,” and said it is “working hard to reach an agreement” with the broadcaster.
Meanwhile, pro-MVPD lobbying group American Television Alliance (ATVA) issued a statement on Monday assailing Fox Networks Group, saying its warning messages of a potential “black out” amount to a “bargaining ploy” to increase its retransmission consent rates and other licensing fees.
“The retransmission consent market should behave like any other market – extraordinary performance will lead to increased compensation – but the opposite is true here,” said ATVA spokesperson Jessica Kendust. “Stations continue to lose viewers, and then advertisers, and so they wait until programming is at its short-term peak to threaten or carry out service disruptions. Unfortunately, these tactics will continue until Congress steps in to make much-needed reform to these outdated TV laws.”
