UPDATE (keep refreshing for breaking news): What an awful way to ring in 2009. It turns out that Viacom claims it has been trying to negotiate a "fair" renewal of its prized cable channels for months and months, but reputedly Time Warner Cable has been unresponsive and "unreasonable". The nation's 2nd largest cable system operator, in turn, claims Viacom is asking for "exorbitant" increases in carriage fees which would have to be passed along to the customer. So now this fight between the two Big Media giants will hurt cable viewers. At 12:01 AM on January 1st, just after the ball drops in Time Square, Time Warner Cable's 13 million subscribers will lose 19 Viacom channels. The howling starts here, especially by parents home for the holidays with children who won't have access to their favorite shows like SpongeBob Squarepants and Dora The Explorer, and tweens/teens wanting to see new episodes of those new unreality Reality TV series The City and Bromance, and twentysomethings and older who get their news from The Daily Show With Jon Stewart or The Colbert Report.
This affects all U.S. Time Warner cable subscribers including those in New York and Los Angeles. Alex Dudley, a vice president at Time Warner Cable, the nation's second-largest cable operator, is telling reporters that the dispute with Viacom "is that they have asked for an exorbitant increase in their carriage fees and their network ratings are sagging. Basically we're trying to hold the line for our customer." Time Warner Cable claims Viacom has asked for fee increases of between 22% and 36% per channel, but Sumner Redstone's company maintains the increases would cost less than $.25 a month for the package of channels per subscriber who spend a fifth of total TV time watching Viacom shows but its fees make up less than 2.5% of the Time Warner cable bill. (Sports channels are paid the biggest cable premium). But Time Warner Cable also is complaining that Viacom's popular shows are rerun on Web sites where Viacom collects advertising revenue that it does not share with Time Warner. On the other hand, Viacom has staked much of its revenue-growth prospects on squeezing higher carriage rates out of its cable and satellite affiliates despite an ad slowdown and weaker ratings.
Such negotiation battles between cable networks and cable system operators have happened before and lasted merely hours. In 2004, for example, Viacom's cable channels disappeared from EchoStar's Dish Network for two days while both sides fought over the terms of a new contract. And Time Warner blocked ABC from its cable systems in New York during a breakdown in contract negotiations with parent company Disney. So this one will either end fast or go on forever. It probably will depend on how many subscribers start flooding Time Warner Cable with obscene calls. Viacom has already started a hardball campaign to "Call Time Warner Cable and say 'NO' " starring The Hills and South Park.
This is Viacom's just issued statement:
This move by Time Warner Cable to force such channels as Nickelodeon, Comedy Central and MTV off the air is another example of a cable company overreaching for profit at the expense of its viewers.
The renewal we are seeking is reasonable and modest relative to the profits TWC enjoys from our networks. We have asked for an increase of less than 25 cents per month, per subscriber, which adds up to less than a penny per day for all 19 of MTV Networks’ channels. We make this request because TWC has so greatly undervalued our channels for so long. Americans spend more than 20% of their TV viewing time watching our networks, yet our fees amount to less than 2.5% of what Time Warner generates from their average customer.
http://www.deadlinehollywooddaily.com/happy-new-year-time-warner-cable-to-yank-mtv-nickeodeon-comedy-central-off-the-air/
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