Published in Economic Development

Tribune TV stations go dark amid contract standoff

BY Wednesday, January 09, 2019 11:25am

Approximately 6 million television viewers in more than 20 markets, including West Michigan, have lost access to local news, sports and entertainment programming because of a contract dispute between two mega media groups.

Chicago-based Tribune Media Co., the owner of Fox 17 WXMI in Grand Rapids, prohibited its programming from access by Spectrum cable subscribers after the two companies failed to reach an agreement to renew a contract that expired last week. Spectrum, a subsidiary of Connecticut-based Charter Communications Inc., claims Tribune Media has more than doubled its retransmission fees, which cable and satellite providers pay to broadcasters to include channels in their lineups.

In addition to local networks, more than 14 million subscribers nationwide also lost access to Tribune’s WGN America, a cable station “very few people watch,” according to Spectrum.

“This is how Tribune Broadcasting operates,” Spectrum said in a looped-broadcast on Fox 17, WGN, and other affected channels. “Driven by greed, they’ve pulled their channels from other distributors over the recent years as a negotiating tactic.”

Last month, Tribune Media announced it had agreed to a mega-merger with Texas-based Nexstar Media Group Inc. Through the proposed all-cash transaction valued at $6.4 billion, Nexstar would collect 42 locally operated stations, WGN America, “equity ownership” in the Food Network and Cooking Channel, and the assumption of Tribune Media’s $2.3 billion outstanding debt, as MiBiz previously reported.

“Why is Tribune acting this way? Perhaps it’s because they entered into an agreement to be purchased and are trying to make lucrative packages for their executives after the transaction,” according to the Spectrum broadcast to subscribers.

Nexstar, which plans to complete the acquisition of Tribune Media late in the third quarter of 2019, currently is waging similar pricing disputes with broadcasters in Indiana, Tennessee and Maryland.

On Monday, Tribune Media CEO Peter Kern used the company’s media outlets to publish an open letter to Tribune viewers and Spectrum subscribers.

“The reality is that what Spectrum is saying on TV and online about our negotiations is simply false,” he said. “We are not asking for triple or double the rates for our programming. We are asking only for a fair deal, one that is comparable to what every other cable and satellite TV provider pays us for our content.”

He noted that Spectrum is a “huge goliath of a company” that generates $43 billion in annual revenue and earns more than $10 billion in annual profits, making it about 20 times larger than Tribune Media, according to reports.

“Spectrum believes that as a much smaller company, we will give in to their tactics,” Kern said. “We have tried to take the high road — we have not called them names or accused them of anything. But, at our heart, we are an information company and we don’t want our viewers misinformed any longer.”

In the meantime, residents with digital antennas can access local Tribune Media broadcasts for free.

Read 3204 times Last modified on Friday, 11 January 2019 12:16
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