Dish-Lifetime Spat Could Be Costly

With EchoStar Communications Corp. threatening to permanently drop Lifetime Television from its Dish Network direct-broadcast satellite lineup as of midnight Tuesday, the two parties have resumed discussions in hopes of resolving their bitter monthlong dispute.

Talks between the two parties broke down Sunday, Jan. 22. But Lifetime and EchoStar each said Friday that they were having ongoing conversations as they confronted the possible repercussions of a permanent breakup: Each side could lose millions of dollars from lost subscriptions, program-licensing fees and advertising revenue.

If the brouhaha -- which began on New Year’s Day -- isn’t settled soon, the women’s programmer will lose roughly 12 million Dish subscribers from its base of 89.5 million. That could cost Lifetime tens of millions of dollars per year in license fees and ad revenues.

EchoStar, for its part, could see a greater number of subscriber losses each month.

Beyond subscriber losses, EchoStar has already taken a hit in the wallet over Lifetime. The DBS provider recently reached a retransmission-consent deal with Lifetime’s corporate cousin, Hearst-Argyle Television Inc.

Previously, deals for carriage of Lifetime and the Hearst stations were tied together. But this go-around, EchoStar negotiated a separate deal with Hearst, reducing Lifetime’s leverage.

EchoStar paid dearly for that split-off: It agreed to pay 45 cents per month for those subscribers who receive the local Hearst channels. That license will cost EchoStar $11 million per year, according to Bear, Stearns & Co.

As it stands, EchoStar has already permanently replaced Lifetime spinoff Lifetime Movie Network with another women’s channel, Oxygen. That move alone means a few million dollars of lost revenue per year for parent Lifetime Entertainment Services.

Estimating that the flagship Lifetime channel gets a licensing fee of 20 cents per subscriber, the loss of Dish distribution could translate to roughly $29 million in lost revenue for the year. According to one cable operator’s calculations, getting dropped from Dish is costing Lifetime $200,000 per day.