Belo threatens to pull stations from DirecTV over retransmission negotiations
DirecTV (Nasdaq: DTV) subscribers in 11 states could lose the signals from stations carrying programming from ABC, CBS, Fox and NBC on Nov. 1 unless the satellite TV provider strikes a retransmission-consent deal with station group owner Belo Television Group.
Belo, which operates 16 stations in Texas, Arizona, Washington, Arizona Kentucky, Oregon, Idaho, Missouri, Louisiana, North Carolina and Virginia, wants DirecTV to pay an increase in retransmission consent fees, and has been warning viewers that they could lose their favorite shows if they are DirecTV subscribers. It's possible that Belo could pull its signal if DirecTV doesn't agree to its terms, but losing the DirecTV subscriber base would take a toll on ratings for Belo stations and sap ad revenue from the stations.
Some broadcasters have shown that they are willing to pull their signals unless a pay TV provider agrees to a pay more cash for carriage of their programming News Corp. (Nasdaq: NWSA) pulled Fox programming from Cablevision (NYSE: CVC) during baseball's World Series last year, and Mediacom Communications systems have gone without programming from LIN TV stations for about six weeks since its retransmission agreement expired.
But as DirecTV noted in a statement regarding the Belo dispute, the broadcaster may be threatening to pull its signals in an attempt to gain some leverage in negotiations.
"Belo has decided to notify its viewers of our discussions, which is something they did during similar talks with Time Warner Cable (NYSE: TWC) and Dish Network (Nasdaq: DISH) last year. None of those customers ever lost access to Belo stations and we expect the same positive result here," DirecTV said. "Their TV commercials are nothing more than a routine approach to try and gain leverage in negotiations. DirecTV customers should ignore Belo's scare tactics and enjoy their DirecTV service as they always have."
- The Dallas Observer has this story
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Retransmission consent revenue jumped 46.7% in 2010