Tuesday, December 23, 2014

Another Year Ends, Another Network Blackout

What would an end of year be if a cable operator and a cable network weren't in the midst of a license fee renewal.  It seems that it is a constant occurrence with always the same outcome, a network or two gets dropped for a period of time and then it is reinstated at a later date. This year the battle is between Dish and Fox regarding just two of its channels, Fox News Channel and Fox Business Network.  As of this moment, carriage agreements have expired and both have been pulled from the Dish line-up.

And like before, there is the necessary pr and paid advertising telling customers their side of the story in a time where consumers are simply tired of being part of every battle.  Frankly a no win scenario.  Some consumers switch cable operators as a result of the loss of channels, most remain.  Dish and its customers are used to such drops and re-launches.  Remember the AMC fight, the CNN battle? The dance is ongoing with short term suffering for fans of those respective networks.

Of course there are two sides to every story and the cost of cable programming certainly drives at the heart of such negotiations.  Operators will have a hard time paying to carry every possible linear network; those costs cause cable bills to rise.  Sports are a huge component of those costs, yet those networks are the hardest to drop.  Also because most major networks are owned by multi network businesses, leverage becomes a big factor in driving all of its networks to be launched.  Don't think Fox won't use pressure from its Fox Broadcasting, Fox Sports, FX, and others to drive a Fox News and Fox Business renewal.  Size does matter in these fights.  For now, Dish customers have lost access to a couple channels; in the long run, they will be renewed and added back to the line-up.  It is how the dance is done.

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