http://variety.com/2015/biz/news/dish-sinclair-tv-blackout-1201578634/
Dish Loses 129 Sinclair Stations in Biggest TV Blackout Ever
About 5 million Dish Network subscribers lost access to 129 local TV stations
operated by Sinclair Broadcast Group across the U.S. late Tuesday, in what
amounts to the largest single TV blackout in history in terms of channels
dropped.
Dish said the companies had reached an agreement on rates and all other terms
for the carriage of the Sinclair local stations, but that Sinclair demanded the
satcaster pull its signals anyway. Dish alleged Sinclair forced the blackout
because it wants to gain leverage in carriage negotiations for a cable channel
— which Dish didn’t identify — that Sinclair is aiming to buy.
“We have agreed to rates and all terms to carry Sinclair’s local stations,”
Warren Schlichting, Dish’s senior VP of programming, said in a statement. “But
Sinclair is blacking out 129 local stations in an effort to negotiate a
carriage agreement for an unrelated cable channel that it hopes to acquire, but
does not own today.”
In response, Sinclair exec VP and general counsel Barry Faber said in a
statement: “Dish, which is reported to have engaged in more recent station
blackouts than any other MVPD, is simply trying to spin the facts in an
apparent effort to make a political statement. While Sinclair, unlike Dish, is
not interested in negotiating this transaction in the press, Sinclair remains
willing to negotiate a fair deal with Dish.”
The blackout affects stations in 79 markets in 36 states and Washington, D.C.
Most of the stations are affiliated with the Big Four networks or the CW.
Separately, Dish has extended its retransmission contract for 23 local stations
not controlled by Sinclair for which Sinclair handles carriage negotiations.
The two sides had reached a temporary truce Aug. 15, when their previous pact
was set to expire at midnight ET, as they continued to negotiate.
In the wake of the blackout, Dish reiterated its appeal to the Federal
Communications Commission to intervene in the situation. Earlier this month the
company filed a complaint with the FCC accusing Sinclair of violating the
good-faith covenants of the FCC’s retransmission consent rules. Dish said it
intends to amend the complaint to include the allegations that Sinclair has
tied the retrans talks to carriage of the unnamed cable channel.
Update: In a statement released at noon ET Wednesday, FCC Chairman Tom Wheeler
said he has directed the agency’s Media Bureau to arrange an emergency meeting
with Dish and Sinclair. He said the companies will have until midnight to file
their views on the dispute.
“The public interest is the Commission’s responsibility,” Wheeler said. “We
will not stand idly by while millions of consumers in 79 markets across the
country are being denied access to local programming. The Commission will
always act within the scope of its authority if it emerges that improper
conduct is preventing a commercial resolution of the dispute.”
For Dish, the retrans fight with Sinclair comes after it lost a net 81,000
pay-TV subs in the second quarter of 2015, with analysts estimating it shed
151,000 satellite TV customers. As of the end of June, Dish reported 13.93
million TV customers, including those with its over-the-top Sling TV service.
Dish has a legacy of pugnacious relations with broadcast and cable TV networks.
Since January 2012, Dish has been involved in 32 of the 74 retrans disputes in
the U.S. that have led to stations going dark for pay-TV subs, according to the
National Assn. of Broadcasters.
The FCC has said it plans to review rules regarding retransmission consent,
given the uptick in battles between station groups and pay-TV providers. Cable
and satellite TV providers are required by law to carry broadcast TV stations.
However, the compulsory carriage requirement goes out the window if
broadcasters are seeking retrans fees, which require negotiations between
station owners and MVPDs.
Broadcast TV stations, which provide their over-the-air signals free to the
public, have been demanding increasingly higher fees from pay-TV distributors.
Retrans revenue for the industry is projected to hit $6.3 billion this year,
ballooning to $10.3 billion by 2021, according to research firm SNL Kagan