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Some Time Warner Customers Could See Outages

December 29, 2010

Customers of Time Warner Cable Inc., from Maine to Florida, could lose access to certain network television stations due to a contract disagreement with Sinclair Broadcast Group.

According to an Associated Press report, the contract dispute between Sinclair and TWC is one of a growing number of clashes over fees that cable providers pay broadcast stations to include their signals in channel lineups. A high-profile dispute erupted earlier this year causing Cablevision Systems Corp. customers to go without Fox programming for two weeks, missing two World Series games.

Broadcast companies originally allowed cable providers to carry their channels for free, making their money selling commercial airtime. But competition with cable networks for ad dollars has strengthened, and the recession highlighted how quickly as spending can fall off when businesses need to cut spending. Now broadcasters see the fees from cable providers as necessary backup revenue.

In the latest quarrel between Sinclair and Time Warner Cable, Sinclair is asking for more cash for the right to carry signals from its stations, but the cable giant is resisting the increase.

If a deal isn’t reached by Friday Dec. 31, 33 Sinclair stations in 21 markets — which include Fox, NBC, CBS, and ABC affiliates — could go dark for Time Warner customers at midnight on New Year’s.

The disputes have been rather tough for sports fans, who rely on most of these stations for their weekly sporting events. If Sinclair and TWC do not reach an agreement by the weekend, millions of sports fans could miss out on seeing their favorite teams battle it out this weekend, and possibly every weekend thereafter.

Sinclair said Tuesday that Time Warner has not presented a counterproposal since rejecting the most recent offer by broadcasting company. Time Warner says it is still ready to negotiate.

Still, Sinclair doesn’t have as much influence in these negotiations as bigger networks themselves, which have stations in major markets such as New York and Los Angeles and are owned by media conglomerates, which also operate cable networks.

Sinclair’s stations are located in smaller cities, including San Antonio, Texas, Buffalo, N.Y., and Pittsburgh.

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