One of EchoStar Communications' disputes with two programmers may come to a final head this week, with Court TV possibly permanently losing carriage on the satellite service.
EchoStar chairman Charlie Ergen earlier this month said he might replace Court TV for good on his Dish Network service if a new distribution deal is not reached by Feb. 1.
Court TV, now owned by Turner Broadcasting System, lost carriage to roughly 11 million Dish subscribers on New Year's Eve, with the expiration of its affiliate contract. In the interim, Dish has replaced the crime-and-justice network with The Biography Channel.
EchoStar is also embroiled in a $90 million legal dispute with Court TV's Time Warner Inc. corporate sibling, HBO.
The premium service has sued EchoStar, for what it claims is a failure to pay monthly license fees on a timely basis, miscalculation and underpayment of license fees and accrued interest payments.
As of press time Friday, Turner's 800-number line, which urges Dish subscribers to switch to DirecTV or their local cable company, had received more than 122,000 calls, according to a Turner spokesperson.
Dish Network wanted to move Court TV from its “America's Top 60” tier to “America's Top 120,” which reaches 3 million fewer homes. Under Court TV's tiered rate card, that would mean a license-fee increase — a 70% hike, EchoStar claimed.
At least one industry analyst last week was predicting that Court TV, despite Ergen's threatened Feb. 1 deadline, will eventually return to one of Dish's tiers.
“I kind of doubt that they would drop them permanently,” Kagan Research analyst Derek Baine said. “Everybody says we're never going to go back to the table. It's too important of a distribution outlet for Court TV.”
Jimmy Schaeffler, chairman of the Carmel Group, said Ergen and EchoStar are getting “a unique reputation” for getting into battles with programmers and dropping their networks – and that this strategy won't help Dish Network long-term.
“Good business practices mean you prepare ahead of time for things like this … I would be very reticent to run a company this way. For me, it's operating more on bad faith than it is on good faith.”
In recent years, EchoStar has been involved with carriage disputes with Lifetime Television, OLN (now Versus) and Viacom.
HBO filed its suit against EchoStar two weeks after the satellite company dropped Court TV.
HBO denied that its lawsuit was an attempt to put Time Warner's corporate leverage to bear on behalf of Court TV against Dish Network.
For its part, EchoStar last week charged that HBO filed its litigation in retaliation for the satellite provider lodging a program-access complaint last fall against HBO with the Federal Communications Commission. HBO denied that allegation.
EchoStar also said it is being asked to pay a premium to distribute HBO's services.
HBO responded by saying: “That's simply not true. Our proposed agreement is in no way discriminatory.”
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