Starz, Altice USA Talks Hit A Snag

Altice USA and Starz appear to be ready to battle it out over carriage of the premium channel, with both sides apparently far apart in reaching a deal as their Jan. 1 deadline approaches.

Starz placed ads in The New York Times and New York Post on Saturday (Dec. 30) warning that customers could lose access to the premium channel if a deal wasn’t reached by New Year’s Day.

In a statement, Starz says it has been working in good faith to reach an agreement with Altice USA, which has about 4.6 million video customers in the New York metro area and in several Midwestern states. Starz has about 17 separate channels – including the Encore and MoviePlex premium services – and offers original programming like American Gods, Ash vs. The Evil Dead, Outlander and Power. It was purchased by movie and television studio Lionsgate in 2016. 

“But rather than negotiating in a meaningful way, Altice is demanding a totally unreasonable agreement unlike anything that has previously existed in our longstanding partnership,” Starz said in a statement. “We urge them to join with us in working to reach an agreement that is fair, reasonable and operates in the best interests of our customers, many of whom cannot otherwise find programming that speaks directly to them.”

Altice USA said its beef with the channel revolves mainly around pricing. The operator claims that Starz, which launched a standalone over-the-top service since its last carriage deal, is demanding an increase that would price the linear service above its OTT sibling.

People familiar with the premium service counter that it is merely asking for market rates, while they claim Altice is demanding drastic price reductions.

In a statement Altice USA spokeswoman Lisa Anselmo said the OTT service “drastically changes the value proposition their network provides us and our customers.”

“Yet Starz is asking for outrageous increases in programming costs and, given the limited viewership of Starz amongst our customer base and the different ways consumers can directly access Starz content, we are working to reach an agreement that is reasonable and reflects the best interests of all our customers,” she continued, adding that at the Starz-proposed rate, Altice would be forced to charge customers more than the cost for the OTT service.

“…this would be a bad deal for consumers who can get the service for less directly from Starz,” Anselmo said. “Bottom line, we are focused on a deal that reflects the best interests of all our customers and keeping their costs down.” 

She added that Altice USA continues to negotiate and has made “several meaningful offers” including one earlier today [Saturday].

While Altice USA claims that Starz viewership has fallen in the past three years in its footprint, the network has scored some ratings success in the past several years. Starz has the No. 2 and No. 4 top drama in premium television and its programming has resonated with African Americans and the LGTBQ communities. Power is the No. 1 show among African Americans on premium television and also ranks high (No. 2) in African American households in Altice’s footprint. And Outlander continues to attract high ratings among female viewers – it was 2017’s No. 2 scripted series behind HBO’s Game of Thrones.