DirecTV blackout threatens SpikeTV, Comedy Central, MTV and more
Originally published at The Preternatural Post. Please leave any comments there.
History is repeating itself…sort of. Tuesday night, July 10, 2012, DirecTV subscribers will lose popular Viacom channels in the latest round of cable companies and satellite providers fighting with content providers. Among the 26 channels affected by the DirecTV blackout are SpikeTV, Comedy Central, MTV, VH1, Nickelodeon and BET.
The dispute is not unexpected. Industry analysts have speculated that softening ratings for popular shows such as Spongebob Squarepants to Jersey Shore would make this year’s negotiations particularly tough for Viacom. In addition, DirecTV has engaged in public disputes over carrying stations and programming from seven different providers and dropped five of them during the last three years.
According to the Viacom blog, the company accounts for 20 percent of all DirecTV viewing at a cost that is just 5 percent of DirecTV’s programming expenses. DirecTV appears to be on track to meet profit expectations of $5 billion during fiscal year 2012 across the satellite company’s more than 285 stations. Both DirecTV and Viacom indicate negotiations are underway, however, as of this writing no agreements have been reached.
No surprisingly, Viacom has turned to the fans of its many popular shows to help put pressure on DirecTV to accept the terms they are offering. Viacom has set up a website at www.whendirectvdrops.com and an 800 number so that customers can contact DirecTV regarding the issues. The blackout will affect some 20 million DirecTV subscribers.
One interesting, and somewhat new twist to this story is that DirecTV is framing their argument around Viacom’s bundling of popular and less popular stations in their licensing and distribution agreements. Typically, content providers like Viacom sell their programming this way and the satellite and cable companies pass those bundles on to consumers. Increasingly, however, cable and satellite companies want to purchase statins and programming a la carte, something many consumers have been wanting to do for years. DirecTV’s move may be attracting some sympathy from consumers on this point. It is unclear, however, and probably unlikely that any move toward a la carte purchasing deals negotiated by DirecTV with content providers like Viacom will be passed on to consumers at this point.
The timing of the DirecTV blackout, if it happens, seems to favor Viacom. The content provider has a strong presence at Comic Con in San Diego this weekend and many fans who can’t make it to Comic Con 2012 rely on Viacom’s stations including Comedy Central and Spike TV for news and interviews from the convention floor and other hot spots like Nerd HQ. News they won’t be getting if they are DirecTV subscribers and the blackout takes place. Perhaps in an effort to mitigate the Comic Con effect or simply to draw attention to the many places Viacom makes content available and dilutes the value of their stations on DirecTV, the satellite provide has Created an “Other Ways to Watch” tool to help subscribers and non-subscribers find their favorite content.
It’s difficult to tell who will ultimately win this show down between Viacom and DirecTV. Who ever it is, don’t expect it to be consumers or fans.
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