Tribunes Media's TV stations were blacked out to Dish Networks subscribers Sunday evening in a dispute over retransmission consent payments.
Dish blamed Tribune's demands for higher fees for the stations, a well as for its cable network WGN America as the reason why a deal could not be reached.
“Tribune is demanding an unreasonable rate increase for channels that are available for free over the air,” said Warren Schlichting, Dish executive VP of programming. “Actions like Tribune’s are what drive price increases and feed customer frustration for our industry. With Dish free antenna, customers will continue to receive Tribune channels for free over the air, along with dozens of other broadcast channels not normally available to pay-TV customers.”
Dish said Tribune was also trying to force it to carry WGN America and pay a high rate.
Tribune has 42 stations in 33 markets and 7 million of Dish's subscribers received WGN America before the blackout.
“By attempting to force bundle its cable channel with its local broadcast stations, Tribune is using local viewers as leverage to raise rates for WGN America – a channel that is in decline,” said Schlichting. “Tribune is seeking a significant rate increase despite decreasing viewership and recently losing access to Cubs baseball.”
Dish says its viewership data show that WGN America's ratings are down on average more than 20% since the channel’s launch as a cable network. Many of the shows available on WGN America are available on other channels carried by Dish..
“Consumers shouldn’t have to pay twice for the same programming,” said Schlichting.
Tribune said it offered to extend negotations.
“We want to reach an agreement, just as we have with every one of our other cable, satellite and telco distributors, but Dish refuses to reach an agreement based on fair-market value,” said Gary Weitman, Tribune Media’s senior VP for corporate relations. “We want to keep servicing our local communities and we have repeatedly offered Dish a lengthy extension to continue negotiations—unfortunately, Dish rejected these offers.”
Dish said it offered Tribune a short-term extension becuase it was hopeful an agreement could be reached. The terms of the extension said that when the two sides agreed to a new rate, it would be paid retroactively.
“Instead, Tribune chose to turn its back on its public interest obligations and use innocent consumers as bargaining chips," Dish's Schlichting said.
Tribune said that Dish subscribers will be missing programming they want to see. Its CBS affiliates will cary the Tony Awards, ABC affiliates have the NBA Finals, and NBC affiliates have hockey's Stanley Cup Final. In New York, viewers will miss Mets and Yankee games, while Chicago viewers lose Cubs and White Sox games.
“We’ve offered the same kind of fair market rates that Dish already pays other local station groups with ABC, CBS, NBC and CW affiliates with top-rated local news, and other similarly valued cable networks,” said Weitman. “At the same time, we’re willing to accept the same rates for our local stations and WGN America that others are currently paying us.”
Tribune noted that Dish has a reputation of playing hardball in retransmission disputes that has led to blackouts 12 times.
Dish said that the blackout pointed to a need to reform the retransmission consent rules.
Each year, the cost to carry local broadcast stations rises far beyond the rate of inflation, leading to blackouts across the country that affect millions of subscribers of various pay-TV companies," Dish said in a statement.
Dish pointed to figures from SNL Kagan that show fees to broadcsters rising from $215 million in 2006, to $4.9 billion in 2014. Kagan expects them to more than double to reach $10.3 billion in 2021.
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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.