Contract dispute affects local TV viewers
On Dec. 8, two local television stations went dead, at least as carried by the broadcast carrier DISH Network. Coincidentally, one of those stations was the local FOX affiliate that was slated to carry on that same day a football game between the San Francisco 49ers and the Seattle Seahawks, arguably the biggest contest of the season for each team.
The dead air had local football fans, at least those who subscribe to DISH, scrambling to local bars and restaurants such as The Graduate, where they could catch the game. That was two weeks ago and the stations are still not getting aired on DISH because of an ongoing contract dispute between the Colorado-based company and New York City-based Bonten Media Group, which owns ABC affiliates KRCR News Channel 7 of Chico and Redding, as well as Chico’s KCVU FOX 20.
Though both sides say, on the one hand, that they are negotiating in good faith to come up with a new contract, each is also accusing the other of outright greed that is costing the TV viewer. For the past week, DISH has run a full-page advertisement in the local daily that reads: “ABC 7 AND FOX 20 WANT YOU TO PAY 3X MORE FOR THE SAME SHOWS.”
The ad goes on to urge DISH customers to call the stations’ manager, Andrew Stewart, to voice their concerns.
Stewart said in a phone interview that the three-year contract between DISH and Bonten expired in November and that, as a result, DISH dropped the airing of the stations.
KRCR posted this message on its website: “Dish Network has chosen not to provide the KRCR and FOX 20 signals and there has been misleading information sent to you about why they have made this choice. It is important to provide you with the facts about Bonten Media’s negotiations with DISH.”
Stewart said that while contract negotiations continue, DISH is calling the shots.
“We have no control here,” he said. “They’re pressing the buttons in Colorado. And I can’t speak for their timing of turning it off on the day of a Niners football game against Seattle.”
Stewart said the stations get reimbursed by other signal carriers.
“We are asking for three cents per day per subscriber, which is a fair price, and it’s commensurate with what we’re charging other satellite and cable companies we do business with. It’s not anything that is outlandish.”
He said the landscape has changed over the years and now local stations must compensate the networks for the programs.
“In addition to what we have to pay our networks, we also pay millions of dollars for the syndicated programming that we run on our stations—shows like Modern Family, which runs Monday through Friday. These are former network programs that are resold and we purchase them and then air them on our stations.”
Nationwide, DISH has blacked out 16 of Bonten and its business partner Esteem’s stations at this point. Bad relations between stations and their signal carriers have increased in recent years. In August, the website Variety.com reported that DISH customers in 36 markets had lost access to 53 stations owned by Raycom Media after the companies failed to reach a contract agreement. A contract was established after about two weeks, but the details were not released.
DISH, Stewart said, is a $14 billion organization and “a difficult company to deal with.”
Any chance of a breakthrough?
“It’s not just our company that has gone through this with DISH,” Stewart said. “They’ve done this all over the country, and these negotiations can happen with every satellite and cable provider because they are obligated to reimburse us in small part for the distribution of our signal. They resell our signal. In fact, the highest percentage of satellite and cable viewing is still network television.”
The CN&R’s calls to DISH were answered by sales reps looking to provide a contract. Their efforts to connect us to a media-relations person simply routed us back to another salesperson.
An email inquiry to the company brought the following response from John Hall of DISH’s corporate communications office, who said he could not comment beyond the prepared statement, which said in part: “We are available around the clock to negotiate a deal to restore the channels; however, Bonten and Esteem continue to demand a 300 percent rate increase. This service disruption comes despite DISH’s offer of a short-term contract extension that would keep the channels up, as the two parties continue to negotiate. Furthermore, Bonten and Esteem rejected DISH’s offer to match the rates they receive from DISH’s primary competition, and additionally declined to accept the same rates that DISH pays to other broadcasters in the area.”
Lynda Bos, the office manager of the local company B&T Satellite, an authorized DISH retailer, weighed in on the situation. She said she is not sure what is going on between Bonten and DISH, but defended DISH as a company.
“This all depends on which side you believe,” she said. “DISH is saying Bonten wants a 300 percent increase. Bonten wants you to think they are a simple mom-and-pop company, but they have an office in the Empire State Building. It’s like my divorce attorney said: There is your side, your husband’s side—and the truth.”
She said her company is advising customers to switch for the time being to Charter Communications cable service, whose month-to-month service won’t lock them into a contract if and when DISH and Bonten come to an agreement.
Charles Ergen, DISH Network’s owner, “is a straight shooter,” Bos said.
“He’s providing quality programming at the least possible price. It’s not his goal to own an island or anything like that. I’m more inclined to believe DISH. But you’re not going to know unless you sit through the meetings with their legal representatives.”
Ergen, according to Forbes Magazine, is worth $10.6 billion and is known for contributing heavily to Democratic office-seekers. He was investigated a few years ago for allegedly putting pressure on some of his underlings to also make political contributions to Democratic candidates.
In January of last year, DISH introduced a service that allows its customers to skip television commercials. In response, CBS, NBC, ABC and FOX filed lawsuits arguing that if DISH is allowed to offer the ad-skipper, it will put the networks out of business.