TDS Touchdown: A New Deal With Nexstar


How powerful is the National Football League championship?

While the “Big Game” turned out to be a snoozer for many Americans, its appeal is so great, not having access to it could be highly damaging to a TV station owner and a multichannel video programming distributor (MVPD).

Should Tom Brady therefore be thanked for ending a six-week impasse between Nexstar Media Group and a member of the American Cable Association?

Nexstar on Friday reached “a comprehensive agreement” to restore transmission of its TV stations across all of the local cable systems operated by TDS Telecom, a subsidiary of Telephone and Data Systems.

This ended a dispute that saw Nexstar-owned stations yanked on Dec. 31, 2018 for some 50,000 TDS subscribers in eight states.

Terms of the agreement will not be released. But, it is a safe bet that they were amicable enough for both TDS and Nexstar so that TDS customers wouldn’t have to follow through with instructions provided Wednesday (1/30) on how to watch the Super Bowl for free.

“We don’t want our customers to miss out on the big game,” said TDS President/CEO Jim Butman.

But, instead of getting a Nexstar deal done and reinforcing the concept of “cord cutting,” the TDS leader reinforced it by suggesting how anyone in the U.S. could stream the game via the CBS Sports TV app.

Not mentioned: the acquisition of a digital TV antenna, which costs roughly $22. That said, the communities involved likely cannot receive over-the-air signals from such a device.

As of Jan. 30, Butman was repeating his defensive comments against Nexstar in explaining to TDS subscribers ways to not be locked out of watching Super Bowl LIII, won by the New England Patriots.

“We offered them the same rate increases other broadcasters have agreed to,” Butman said. “They are demanding premium rates even for channels that are completely free over the internet and over-the-air. In addition, Nexstar is including contract language demanding rate increases for its local stations even if they lose their ability to broadcast major network content and start carrying less desirable programming.”

On Feb. 1, there was no longer a need for such fiery one-sided talk.

“I would like to personally thank our customers for their patience and cooperation during the negotiations,” Butman said. “Because of their support we were able to come to a reasonable agreement with Nexstar.”

How reasonable that deal is remains tightly guarded, however.

In a note to TDS customers distributed Feb. 1 via its online blog, author Missy Kellor wrote, “We know you’ve felt caught in the middle and we appreciate you sticking by us. We received hundreds of responses to our request for feedback. We also read all your blog and social media comments. Lots of you even raised your concerns to the FCC.  Your voice was heard!”

Indeed, TDS’ fight against Comcast received much Capitol Hill attention — thanks in large part to the Pittsburgh-based ACA.

On Jan. 22, the ACA asserted that Nexstar, the company founded by former TVB Chairman Perry Sook, was not playing fair with respect to how it has been negotiating its retransmission fee agreement with TDS, one of the nation’s smaller cable TV providers.

In an opinion piece distributed to ACA members on Jan. 22, ACA leader Matthew M. Polka used the impasse between TDS and Nexstar to rail against broadcast TV owner consolidation, which “threatens to extract even more money from pay-TV subscribers who rely on their cable TV connection to see ‘free TV.’”

Nexstar Media Group, which in early 2017 closed on its acquisition of Media General and now seeks to merge with Tribune Broadcasting, struck the ire of the ACA in the final days of 2018, when it failed to reach a new retrans fee agreement with TDS.

This resulted in a “blackout” of Nexstar-owned CBS affiliate KOIN-6 in Portland, Ore., to some 21,894 subscribers of BendBroadband in the small towns of Prineville and Crooked River Ranch, Ore.

The BendBroadband retrans agreement dates to when TDS acquired Crestview in 2017.

The former Baja markets now owned by TDS presented the biggest headache for Nexstar.

The channels and markets impacted here include:

Cortez: CBS and Fox
Fort Carson: FOX and CW
Woodland Park: Fox

In Cortez, KRQE, KWBQ, and KASY in Albuquerque are impacted as a DMA shift to allow Denver-area stations has not yet transpired for MVPDs; KREZ-6 in Durango, Colo., is a full-time satellite of KRQE. In Fort Carson and in Woodland Park, KXRM-TV and KXTU-LD in Colorado Springs are effected.

Mesquite: CBS and Me TV

KLAS-8 in Las Vegas is the impacted station in this town.

New Mexico
Alamogordo: CBS and Fox
Carlsbad: CBX and Fox
Eunice: ABC
Hobbs and Lovington: CBS and Fox
Ruidoso: CBS and Fox
Socorro: CBS and Fox
Truth or Consequences: CBS and Fox

In all markets but Eunice, KRQE, KWBQ, and KASY in Albuquerque are impacted; KBIM-10 in Roswell, N. Mex., is a full-time satellite station of KRQE. In Eunice, KMID-TV in Odessa-Midland, Tex., is the impacted station.

Alpine: ABC
Fort Stockton: ABC
Seminole: CBS

Odessa-Midland, Tex.-based KMID-TV is impacted here, as is KLBK-TV in Lubbock.

Cedar City: ABC, CW, Me TV and Grit TV
St. George: ABC, CW, Me TV and Grit TV

KTVX and KUCW in Salt Lake City are the stations serving these southwest Utah cities.

Given these locales, MVPDs are practically essential for viewing network television affiliates from the nearest DMA.

Then, there are the 93,000 people in IPTV markets where My Network affiliate WNDY-28 and The CW affiliate WISH-8 in Indianapolis; ABC affiliate WKRN-2 in Nashville; and ABC affiliate WATE-6 in Knoxville — all Nexstar stations — were blacked out for rural subscribers.

As TDS sees it, it was all due to Nexstar “demanding up to a 175% rate increase.”

Now, TDS is issuing bill credits for programming missed in January, and hopes its deal with Nexstar is solid enough to prevent a future disruption — and ACA involvement in D.C.

ACA wants a “full examination” of Nexstar’s conduct in connection with its proposed acquisition of Tribune and include a broader discussion of retransmission consent issues when Congress renews key satellite legislation.

The ACA did not offer an immediate comment on the TDS-Nexstar pact when contacted Monday (2/4) by RBR+TVBR.