Clash of the titans: the cable wars, continued

June 3, 2010: 11:41 AM ET

News Corp. vs Cablevision. Cablevision vs. Disney. The list goes on and on. An updated tally of cable licensing deals gone horribly awry.

As the Cablevision and News Corp. feud continues, more than three million subscribers remain without Fox programming. Cablevision blames News Corp. for demanding an extortionate increase in retransmission fees; News Corp. argues Cablevision isn't negotiating in good faith. Regardless of which party is at fault, the cable licensing spat has already proven to be every bit  as vitriolic as prior contract negotiations.

Indeed, nowhere in the world of business does such juvenile name-calling, verbal hair-pulling, sub-Algonquin-style repartee exist outside of the recurring cable vs. network fee-battles. Behind closed doors, executives from all industries may let loose on customers and rivals, and lawsuits contain spurious allegations of misdeeds. But these particular media battles take place in front of both sides' customers -- and because they each own ad inventory, the attacks come over and over.

So kick back, get the popcorn ready, and let's revisit the greatest hits from recent cable licensing deals-turned-boxing-weigh-in spectacles.


The problem: Cablevision (CVC) says News Corp. (NWSA) wants to up its annual retransmission fees from $70 million to $150 million. When the companies did not reach an agreement by last Friday's deadline, News Corp. pulled Fox channel access, including Fox 5 and My9.

The affected: More than 3 million subscribers in New York, New Jersey, and Connecticut remain without access.

What they said:

CABLEVISION: "This is an unfortunate attempt to extort unreasonable and unfair fee increases from Cablevision and our customers," read an email to subscribers. "They [News Corp.] want more for Fox 5 than we pay CBS, NBC, ABC and Univision combined ... We call on News Corp to accept binding arbitration, and return Fox 5 and My9 to the air until an agreement is reached.

NEWS CORP.: "Cablevision needs to stop hiding behind a call for binding arbitration and negotiate in good faith."


The problem: In March, Cablevision argued that ABC, under Disney (DIS), was seeking an additional $40 million a year in new fees on top of the $200 million the cable provider already pays each year.

The affected: More than 3 million subscribers in and around the New York City area lost ABC access for 21 hours. It returned shortly after the Academy Awards started on a Sunday night.

What they said:

ABC: "Cablevision has betrayed you again," said a message that flashed on TV screens shortly after ABC went dark. "First HGTV and Food Network, now you lost ABC-7. Enough is enough! Go to to switch your service now."

CABLEVISION: "It is now painfully clear to millions of New York area households that Disney CEO Bob Iger will hold his own ABC viewers hostage in order to extract $40 million in new fees from Cablevision," read a statement from Charles Schueler, Cablevision's executive VP of communications. "We call on Bob Iger to immediately return ABC to Cablevision customers while we continue to work to reach a fair agreement."


The problem: Last January, Cablevision said Scripps Networks (SNI) demanded a rate increase of 200%.

The affected: 3 million subscribers in Connecticut, New York and New Jersey were unable to watch the Food Network and HGTV for three weeks.

What they said:

CABLEVISION: "If Scripps really cared about their viewers, they would put their programming back on and negotiate a new agreement," read a statement.

SCRIPPS: "Our valuable networks simply are not being compensated like top ten networks by Cablevision," Kenneth W. Lowe, president and CEO  of Scripps, announced in his statement. "The distribution rates Cablevision pays for Food and HGTV are among the lowest in the industry."


The problem: In December, Fox was said to have asked for $1 per subscriber per month, the equivalent of $13 million more per month.

The affected: More than 13 million Time Warner Cable subscribers around the country, had Time Warner Cable and Viacom not settled in time.

What they said:

TIME WARNER CABLE: "Pay our price or you'll never see Fox again," read a faux-ransom letter drafted by Time Warner Cable and placed in papers.

FOX: "No Fox? No Way," stated a series of News Corp. (NWS) ads alongside collages of pictures from the network's hit shows.


The problem: In late December 2008, Viacom (VIA) demanded Time Warner Cable (TWC) cough up $39 million in addition to the estimated $300 million Time Warner Cable spends annually for continued access to 19 cable channels including MTV, Comedy Central, and Nickelodeon.

The affected: More than 13 million Time Warner Cable subscribers around the country had Time Warner Cable and Viacom not settled in time.

What they said:

VIACOM: "Why is Dora crying?" read an advertisement Viacom placed in The New York Times alongside an illustration of a tearful Dora the Explorer. "Time Warner is taking Dora off the air tonight! Along with 19 of your favorite channels."

TIME WARNER CABLE: "The reason that Dora is crying is because she's going to have to fly coach instead of business class, as they used to," said Time Warner Cable spokesperson Alex Dudley.

Current Issue
  • Give the gift of Fortune
  • Get the Fortune app
  • Subscribe
Powered by VIP.