News Corp: No deal likely


News Corp. said on Wednesday (12/20) that it was doubtful that it would sign a new distribution contract with Time Warner Cable by Thursday night, increasing the likelihood that its Fox stations will be removed from cable lineups in millions of homes.

News Corp. President Chase Carey declined an offer by Time Warner Cable to enter binding arbitration to bring a resolution to the retrans. fees dispute. Fox is demanding about a dollar for each cable subscriber each month.

The contracts expire at midnight 12/31. Fox could then take its signal off Time Warner Cable systems in New York, LA, Dallas and other big cities.

Time Warner Cable reps arrived in LA early this week for the Fox talks, which are part of a renewal deal that also will affect several News Corp. cable channels, including FX.

Time Warner Cable responded to a letter from Senator John Kerry (D-MA) and offered to extend talks into 2010. Hours later, Carey said News Corp. would not provide an extension because it had been “trying since the summer to negotiate a fair deal,” reported The New York Times.

“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,” 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.”

Kerry said 12/30 he would press the FCC to intervene in the dispute.

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.

On Wednesday, ABC reportedly indicated that it would stand with Fox in the dispute. Disney said in a statement that its ABC stations represented a “tremendous value” and were “worthy of fair compensation.”

RBR-TVBR observation: Fox’s demand for a dollar per subscriber each month would set a precedent for broadcasters that want more money from cable and satellite operators. If Fox gets paid, other broadcasters probably will seek similar amounts. Let’s face it – very few people are now watching broadcast networks over the air anymore, vs. the past numbers with analog. So the cable companies are getting more subscribers because of this, and should be pulling in more revenue. Broadcasters and networks should be able to share in this increase, since it is basically being forced upon so many viewers with pixilated screens and unstable digital reception. Let us not forget also, how much money broadcasters spent on upgrading to digital — with what ROI?