The American Cable Association and the National Cable Television Cooperative have stepped up their fight against AMC Networks, claiming the programmer is forcing small cable operators to purchase unpopular networks in their most recent carriage negotiations.
In an ex parte filing with the Federal Communications Commission, ACA and NCTC told the agency that AMC Networks is requiring small operators to purchase a bundle of less-watched networks in order to get the one channel – AMC – they want.
According to the filing, ACA and NCTC executives and representatives from several small operators met with FCC officials on Dec. 11 to discuss challenges faced by small cable companies. During that discussion NCTC outlined what they called AMC’s onerous tactics, such as forcing NCTC members to buy a package including five low-rated channels (WeTV, IFC, Sundance, BBC America and BBC World News); requiring that members place those networks on the most popular service tier; and requiring that all NCTC members pay affiliate fees based on their total number of video customers, instead of the number of subscribers that would receive each service.
“This demand seems designed to protect AMCN from losses due to cord-shaving, and when combined with AMCN’s demands to carry unwanted programming, it hinders small operators’ ability to serve customers that want a low-priced ‘skinny’ package of programming that can be combined with over-the-top content they may purchase elsewhere,” ACA said in its letter.
In addition, the organizations said AMC is requesting an exorbitant rate increase – double the rate they are charging other operators for the same service – which smaller operators simply cannot pay.
As a result, about 62 NCTC members, representing nearly 1 million subscribers, have said they plan to drop the channels if they can’t reach a compromise by the Dec. 31 deadline.
“These demands, which increasingly include no exceptions for the hundreds of small 'channel-locked' cable systems that are unable to carry additional channels due to capacity constraints, are forcing members to make tough choices in their carriage negotiations: either accept unreasonable prices and terms or drop channels,” ACA said in its letter.
The battle with AMC has been brewing for at least a month, when the network began running crawls on its AMC channel during its popular show, The Walking Dead. At the time, several smaller operators complained that the network was engaging in scare tactics to frighten viewers into switching providers for fear they would miss out on the show. At the time, people familiar with the network said that AMC’s last NCTC agreement was reached eight years ago and that the programmer was merely trying to get NCTC members in line with what other distributors were paying.
"We have extraordinarily high regard for the NCTC and for its members,” AMC said in a statement. “We have long supported smaller cable operators, and the particular challenges and considerations that they face in the service of their markets. We will continue to endeavor to do everything we can to make them successful.”
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