No end to Viacom-TWC dispute in sight

19 channels poised to go dark by midnight

There was no sign of resolution in the carriage-fee dispute between Viacom and Time Warner Cable as midnight approached on New Year's Eve.

The two companies continued talks today over their dust-up that could result in 19 channels -- from MTV and Comedy Central to Nickelodeon and TV Land -- being yanked from more than 13 million homes by midnight tonight, but there was little sign of progress.

While TWC had proposed an increase in what it pays for Viacom's channels, Viacom spokeswoman Kelly McAndrew said the offer was rejected as "a pittance."

On Wednesday, Time Warner chief Glenn Britt in a statement called Viacom's demand for a 12% increase in fees -- amounting to an extra $39 million on top of the estimated $300 million it pays Viacom every year -- outrageous in light of the poor economy.

"We sympathize with the fact that Viacom's advertising business is suffering and that their networks' ratings have largely been declining," Britt said. "However, we can't abide their attempt to make up their lost revenue on the backs of Time Warner Cable customers."

Viacom argued that it's asking for a "reasonable and moderate" rate increase for its 19 channels, saying the fee increase would add up to about 25 cents per subscriber per month. The company took out newspaper ads Wednesday that featured Nickelodeon's animated character Dora, urging viewers to call TWC and demand that their favorite Viacom programming not be taken off the air.

"Why is Dora crying?" the ad read. "Time Warner Cable is taking Dora off the air tonight!"

Viacom also was planning to run TV ads starting Thursday in 11 major markets, including New York and Los Angeles.

TWC spokesman Alex Dudley told the Associated Press that the ad campaign was a sign that Viacom had been preparing for such a scenario.

"They never had any intention of settling this or negotiating in good faith," Dudley said.

Viacom said TV viewers spend a fifth of their time watching Viacom programming, but its fees make up less than 2.5% of the TWC bill. McAndrew also said that the Viacom cable networks' average daily license fee is 65% lower than that of its competitors.

The Associated Press contributed to this report.
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