Posted tagged ‘TV Land’

Time Warner, Viacom Reach New Deal

January 2, 2009

Time Warner Cable and Viacom have finalized details on an agreement that will allow Time Warner customers to continue to watch programming on Viacom’s MTV Networks.

From the New York Times:

The ball had already dropped in Times Square, but MTV Networks and Time Warner Cable kept talking into the early new year and concluded a deal in principle that ensured that shows like “SpongeBob SquarePants” and “The Colbert Report” would still be available to the 13.3 million subscribers to the Time Warner Cable service.

The final terms, which were not disclosed, will be worked out in talks in the next few days, an executive at Viacom, the parent of MTV, said.

The two sides had faced a deadline of midnight to renew the contract under which Time Warner pays MTV a rights fee for its 20 cable networks, which include MTV, Nickelodeon, Comedy Central, VH1, TV Land, BET and Spike.

Viacom demanded an increase of about 23 cents per subscriber to cover its full portfolio of channels, under a threat that it would remove all 20 networks from Time Warner’s systems. Viacom’s chief executive, Philippe P. Dauman, said the increase was justified because MTV Networks had been underpriced compared with other cable networks with fewer viewers.

From CNN:

A source close to the negotiations told CNN that TWC is expected to agree to pay a modest increase to Viacom in the new deal.

The developing agreement is expected to benefit both companies and their audiences, Viacom chief Philippe Dauman said.

On Wednesday, TWC customers faced the prospect that channels such as Nickelodeon, Comedy Central and MTV could go dark as of 12:01 a.m. Thursday.

The dispute arose after Viacom announced new fees for carrying its networks – adding up to $39 million a year on top of the hundreds of millions of dollars TWC is already paying to Viacom, according to TWC spokesman Alex Dudley.

Dudley described the 15% overall increase in fees as “unreasonable,” since programming rates are declining and the United States is facing terrible economic conditions.

TWC  – a publicly traded unit of Time Warner, the parent company of CNN – says it’s working to protect its customers’ interests, but Viacom argued the renewal fees were reasonable and modest when considering the profits TWC enjoys from Viacom networks.

According to Viacom, the new fees would amount to less than 2.5% of what TWC generates from their average customer.

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