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HBO Blacked Out to Dish Network Subscribers

AT&T’s HBO and Cinemax premium channels have been blacked out to Dish Network and Sling TV subscribers in a dispute over a carriage agreement.

Dish said it is the first time HBO has ever blacked out a distributor.

Dish said that HBO made “untenable demands” designed specifically to harm customers, particularly those in rural areas, as well as damage competing pay-TV providers.

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AT&T, which acquired HBO’s parent company Time Warner earlier this year, also owns DirecTV and DirecTV Now.

“Plain and simple, the merger created for AT&T immense power over consumers,” said Andy LeCuyer, Dish senior VP of programming. “It seems AT&T is implementing a new strategy to shut off its recently acquired content from other distributors. This may be the first of many HBO blackouts for consumers across the country. AT&T no longer has incentive to come to an agreement on behalf of consumer choice; instead, it’s been given the power to grab more money or steal away customers.”

Dish suggested using binding, baseball-style arbitration to determine the fair market value of HBO and Cinemax. 

Related: AT&T Sets Review of TV Programming Lineup

HBO pointed the finger at Dish, which has frequently been involved in contentious carriage negotiations that have resulted in blackouts. Univision is currently unavailable to Dish customers because of a fee dispute.

A source close to the situation said that HBO offered Dish an extension and that the HBO signal is still available to Dish.

“During our forty plus years of operation, HBO has always been able to reach agreement with our valued distributors and our services have never been taken down or made unavailable to subscribers due to an inability to conclude a deal," HBO said in a statement. 

"Unfortunately, Dish is making it extremely difficult, responding to our good faith attempts with unreasonable terms. Past behavior shows that removing services from their customers is becoming all too common a negotiating tactic for them. We hope the situation with Dish changes soon but, in the meantime, our valued customers should take advantage of the other ways to access an HBO subscription so they can continue to enjoy our acclaimed programming," HBO said.

Dish opposed the acquisition of Time Warner and HBO by AT&T and the new dispute with Dish could be brought up in the Justice Department appeal of the court ruling that the merger could be completed. 

Dish said that when the AT&T acquisition of Time Warner was approved, no guidelines were put in place to ensure that AT&T "played fair" with other pay-TV providers.

There were no guidelines set in place to ensure that AT&T “played fair” for HBO and Cinemax subscribers, regardless of their pay-TV provider.

Dish noted that AT&T has been offering HBO at a discounted rate to subscribers of its DirecTV Now and wireless phone products. AT&T is also planning to launch a new streaming service that will feature some HBO programming.

"AT&T’s actions are a deliberate slap in the face to rural Americans,” said LeCuyer. “And furthermore, they are anticompetitive. AT&T, a company worth more than $200 billion, is intentionally punishing those who don’t have big-city broadband access, in an attempt to push customers to the only other satellite provider, its own DirecTV.”

Dish and eligible Sling TV customers will be credited on their bill for time they do not receive HBO or Cinemax. Dish is also offering customers a free preview of HDNET Movies which showcases the best in box office hits and award-winning films, uncut and commercial free.

Jon has been business editor of Broadcasting+Cable since 2010. He focuses on revenue-generating activities, including advertising and distribution, as well as executive intrigue and merger and acquisition activity. Just about any story is fair game, if a dollar sign can make its way into the article. Before B+C, Jon covered the industry for TVWeek, Cable World, Electronic Media, Advertising Age and The New York Post. A native New Yorker, Jon is hiding in plain sight in the suburbs of Chicago.