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Disney Pulls WABC-TV Signal From Cablevision In Retrans Dispute

3/07/2010 12:07 AM Eastern

It looks like Cablevision video customers are going to have a find a different way to watch the Oscars Sunday night.
WABC-TV, which on March 1 threatened to pull its signal from Cablevision in a retransmission-consent dispute, sent the station to black at 12:01 a.m. on March 7, as the parties could not come to terms.

In addition to the 82nd annual Academy Awards telecast that is scheduled for March 7 on ABC at 8:30 p.m., Cablevision subscribers will miss the alphabet network's afternoon coverage of the Los Angeles Lakers-Orlando Magic, in a rematch of last year's National Basketball Association final.

Ironically, WABC-TV was airing an episode of Lost, entitled "Three Minutes," when the station went dark for Cablevision subscribers.

Cablevision, the predominant cable operator in metro New York with some 3.1 million video subscribers, claims that WABC-TV has been seeking $40 million annually for its signal, amounting to a monthly license fee of about $1 per subscriber. The cable operator said it already pays WABC-TV parent The Walt Disney Co. $200 million annually for carriage of such cable networks as ESPN and Disney Channel, and that forking over fees for the over-the-air station would constitute a TV tax.

Disney has not disclosed its asking price, but some sources peg it in the 50 cents to 60 cents range. Whatever the amount, the parties could not bridge their differences and the station is now off Cablevision's air.

Sources familiar with negotiations said there was little movement on Saturday and that the parties did not meet face-to-face.

About 12:30 a.m., the channel 7 position on the Cablevision dial, included the network and the station's logos and the following text messages: "ABC has pulled WABC-7... Cablevision pays ABC's parent company over $200 million per year... The price you pay for TV matters... ABC is demanding $40 million more per year... We wanted to keep WABC on the air... Pulling WABC off Cavlevison was wrong... We are working hard to get WABC-TV back on the air... ABC has rejected our offers... We have agreements with CBS, NBC, Fox and Univision... We apologize for their actions."

The customer alert, which also included a voice-over amplifying many of those points, instructed viewers to watch WABC-TV with an over-the-air digital antenna and that most of ABC's primetime programming can be viewed on ABC.com or Hulu.com.

"It is now painfully clear to millions of New York area households that Disney CEO Bob Iger will hold his own ABC viewers hostage in order to extract $40 million in new fees from Cablevision," said Cablevision executive vice president Charles Schueler in a statment. "We call on Bob Iger to immediately return ABC to Cablevision customers while we continue to work to reach a fair agreement."

For her part, Rebecca Campbell, president and general manager, WABC-TV, issued the following statement, after midnight on March 7.

"Cablevision has once again betrayed its subscribers by losing ABC7, the most popular station in the tri-state area. This follows two years of negotiations, during which we worked diligently, up to the final moments, to reach an agreement," Campbell said. "Cablevision pocketed almost $8 billion last year, and now customers aren't getting what they pay for...again. It's time for Jim Dolan and the Dolan Family Dynasty to finally step up, be fair, and do what's right for our viewers."

WABC-TV said Cablevision customers can call 1-877-990-ABC7 or visit www.saveABC7.com for information on how to switch service providers or receive ABC7's signal free, over-the-air

At the same time, Cablevision said its customers should urge ABC Disney to put the WABC programming back on Cablevision by calling 1-877-NO-TV-TAX, visiting http://www.cablevision.com/abc or joining its Facebook group "Cablevision Viewers Say: No New Fees, ABC!"

WABC-TV said it had been negotiating for retransmission-consent compensation for two years, continually granting contract extensions, with the talks heating up of late.

Cablevision CEO James Dolan, speaking at the Morgan Stanley Technology, Media & Telecom conference in San Francisco on March 2, said Disney had resorted to a "bullying" move and Disney only started negotiating in earnest over the past few weeks, not the longer span the programmer mentioned.

Dolan noted that he and Cablevision COO Tom Rutledge traveled to Los Angeles last week to meet with Disney executives.

WABC's decision to pull its signal follows a week's worth of finger-pointing in print and TV ads, sniping by Cablevision and Disney, littered by comments about greed, and ultimately attacks against the leadership of both companies.

Politicians also weighed in on the fracas, with Joe Barton (R-Tex.), the ranking member of the House Energy & Commerce Committee, advising the Federal Communications Commission to let the marketplace negotiations were best left to the marketplace.

Conversely, Sen. John Kerry (D-Mass.) advised the FCC that the government needs to step in to protect consumers and fix what he has long characterized as a broken promise.

As part of its customer alert, Cablevision cited Kerry, as being among 70 elected local, state and federal officials, who believe that WABC should remain on the air as long as the parties continue to negotiate in good faith.

The voiceover, which expressed hope for a resolution, also mentioned that the cable company had repeated meetings with ABC programming executives over the past few weeks to reach "a fair agreement"; that rising programming costs are the primary reason for increased cable rates; that Cablevision had not raised its high-speed data and phone service rates over the past seven years, because there are no programming costs associated with providing those services; and that the MSO has offered to pay as much or more to WABC than any of the broadcast networks in its service area, including the highest-rated one.

This is the second carriage imbroglio Cablevision has been involved in this year. In January, Scripps Networks Interactive pulled its HGTV and Food Network cable channels from Cablevision for about three weeks.

In other highly publicized retransmission-consent disputes, Fox and Time Warner Cable averted the programmer pulling its stations' signals in a number of the No. 2 cable operator's markets on Jan. 1. Those negotiations, which continued throughout New Year's Eve and the first day of 2010, also encompassed a number of Fox Cable Networks properties.

As for Mediacom Communications and SInclair Broadcasting, the parties, facing their own New Year's Day deadline, agreed to a contract extension as the parties continued to negotiate, before concluding a new, one-year retrans pact.

 

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