Sinclair, Time Warner Cable in Program Fee Stalemate

9:38 AM PST 12/29/2010 by Georg Szalai

Their current retransmission deal expires at midnight on Dec. 31, and stations' signals could go dark amid the latest industry dispute.

NEW YORK - 2010 is coming to an end with another retransmission consent showdown, and as at the end of last year, Time Warner Cable is involved.

As the start of 2010 loomed, the second-largest U.S. cable operator had a retrans dispute with News Corp.'s Fox. This time, it is locked into a battle over program fees with TV station firm Sinclair Broadcast Group, which operates 58 TV stations, including 20 Fox affiliates, in upstate New York, Ohio, the Carolinas and San Antonio, Tx, among others.

According to the Wall Street Journal, Sinclair said that TW Cable has rejected its latest offer and refused to engage in further negotiations over program fees, meaning its stations' signals will be removed after midnight on Dec. 31.

TW Cable countered that it has "at no time told Sinclair that we were terminating negotiations," the Journal said.
It added that TW Cable has offered arbitration and emphasized that it "remains open and willing" to negotiate.

Sinclair is asking for a 10 cents per subscriber per month increase to an estimated 25 cents per month, said Miller Tabak analyst David Joyce. "There is a mix of low-rating/low-value network affiliates, such as MNT and CW, with a few ABC and CBS, but a significant mix of Fox stations," he pointed out.

If Sinclair pulled its signals, about 4 million of TW Cable's 12.5 million households would be affected, according to TW Cable. The dispute won't have a material effect on TW Cable's financials or its stock, Joyce suggested.

Meanwhile, satellite TV giant DirecTV and station owner Hearst Television are also negotiating ahead of a midnight Dec. 31 deadline. Those talks covering 29 stations have been lower-key, according to the New York Times. A DirecTV spokesman said talks continue, and his firm is optimistic that a deal can be reached. 

This fall, Fox and Cablevision had a particularly contentious retrans battle that took two weeks to be resolved.

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