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Viacom Demands 100% Rate Increases for Hundreds of Small Cable Systems, Military Bases

Phillip Dampier April 1, 2014 Cable One, Consumer News, GCI (Alaska), HissyFitWatch, Metrocast, Service Electric, Video 3 Comments

viacom networksSmall cable systems across the country and on overseas military bases are being granted hourly reprieves that are keeping up to 24 Viacom-owned cable channels on the air after negotiations to extend an agreement with their program buyer stalled.

Cable operators belonging to the National Cable TV Cooperative, which represents independent cable systems on cable programming matters, report Viacom is demanding an unprecedented 100 percent rate increase for its networks and a guaranteed rate hike of 10% annually on each of its channels.

Viacom’s demands would cost each subscriber at least $4 a month, noted Jack Capparell, general manager of Service Electric’s cable system in the Lehigh Valley of Pennsylvania. Service Electric is a private, family owned cable business with 250,000 subscribers in central and northeastern Pennsylvania and northwestern New Jersey.

The impasse also affects cable systems serving American military bases. Americable has notified subscribers in Yokosuka, Atsugi, Iwakuni, and Sasebo, Japan Viacom was likely to cut off 10 of its cable channels to military families sometime today. Allied Telesis, which offers service to Air Force bases in Japan is also expected to lose programming.

cableoneNCTC members complain Viacom requires cable systems to carry nearly all of its lineup, including lesser-known channels few customers have even heard of, much less want. Even if a cable system chooses not to air a Viacom channel, Viacom’s contracts require cable providers to pay for them if they want to carry Viacom’s most popular networks.

Some cable systems are breaking away from NCTC’s negotiations and opening one on one talks with Viacom. Metrocast secured an agreement for its customers earlier today by negotiating directly with Viacom.

viacomFor most affected cable operators, there is a ‘wait and see what happens’ approach. Others, including Cable ONE, have already moved to replace the Viacom networks with other channels.

“Viacom asked for a rate increase greater than 100%, despite the fact that viewing is down on 12 of their 15 networks – some by more than 30% since 2010,” said Cable ONE. “We asked Viacom to either reduce their rates or allow us to drop some of their less popular networks to reduce the total cost. They refused these reasonable requests.”

Logo_Service-ElectricEarlier today, Cable ONE didn’t wait for Viacom to pull the plug. They pulled it themselves.

“Cable ONE has let these networks go and expects to add many top-rated networks you’ve requested and expand several other highly requested networks to our most popular level of service. Some of the new networks include BBC America, Sprout, Investigation Discovery, the Blaze, Hallmark Channel, National Geographic, TV One, Sundance, and more,” said the company, which expects to publish a full list of the new networks on Wednesday.

Viacom responded with a news release tailored for each affected provider:

GCI_Color_LogoWe are offering Service Electric a double-digit discount off of our standard rate card. It is a better deal than HUNDREDS of other TV providers in the country have agreed to. We have been actively trying to get a deal done with Service Electric for months and they have refused to negotiate in any meaningful way. And now, on top of this, Service Electric is throwing out numbers which simply aren’t true. Our expiring deal with Service Electric is nearly five years old. In that time, we have been great partners and given Service Electric more channels, more on demand content and access to our content beyond the TV – at no additional cost. We don’t understand why Service Electric has chosen to negotiate in this manner. And now, as a result of their lack of interest in coming to a mutually beneficial agreement, you are at risk of losing 19 Viacom networks. We are serious about getting a deal done.

Virtually the entire state of Alaska is also affected.

“We’ve unified to fight for Alaskans and to work toward a fair, long-term agreement that keeps prices stable for our customers,” said Paul Landes, GCI senior vice president. “Viacom wants a rate increase that is 40 times that of the rate of inflation. Alaska pay TV providers, along with 700 small to mid-sized operators nationally, are saying ‘no’ to Viacom’s take all 26 channels or nothing demands.”

GCI is joined by Alaskan providers MTA and KPU in the dispute.

[flv]http://www.phillipdampier.com/video/Cable ONE Viacom Channels Removed New Channels Added 4-1-14.mp4[/flv]

Cable ONE released this video earlier today informing customers they were dropping Viacom networks. (1:00)

Currently there are 3 comments on this Article:

  1. James Cieloha says:

    CableOne, Service Electric, GCI, Buckeye and other NCTC members are being forced by Viacom to add the Epix movie channels in order to carry the cable networks from Viacom and if the NCTC members refuse and fail to add the Epix movie channels meaning Viacom won’t let them carry the basic cable networks til all the NCTC members is willing to agree to add the Epix movie channels in which Viacom love wanting to act like the old Paramount Pictures with the rigid old block booking system of distributing movies and the old RKO General with bribing to the advertisers and the government in which I feel Viacom is doing to the NCTC members on getting them to agree on carrying the Epix movie channels by engaging in old Paramount Pictures block booking and old RKO General bribery behavioral practices when conducting retransmission consent deals with all the MSOs and the MVPDs. Ironically, enough Viacom owns the Paramount Pictures movie studio that was responsible for the practice of block booking in the old golden era of cinema by forcing independent movie theater owners wanting a certain film being required to take other films including films that have not been developed yet through block booking when Paramount was still controlling their movie theater operations til the end of the 1940’s under the Supreme Court order that movie studios could no longer conduct block booking behavioral practices and owned their own movie theaters to show their movies.

    Meanwhile with the Buckeye CableSystem in Toledo, Ohio in which ‎Sinclair‬ is engaging in old rigid Paramount Pictures block booking practices by forcing Buckeye cable subscribers to pay $2 for the privilege and right to carry ‪‎WNWO‬ and to carry the not yet launch cable news channel by taking WJLA’s News Channel 8 into a national news channel for Sinclair that isn’t yet on the air that Sinclair wants all the cable and satellite to carry the cable channel on cable and satellite basic tier as part of all retransmission consent contracts to put their news and opinions on the planned news channel that Sinclair will launch if their planned acquisition of TV stations from Allbritton were to go through the ‪FCC‬, the FTC,‬ ‪and the DOJ‬ in order for Buckeye Cable to carry WNWO again and it will means that David Smith, and Barry Faber, David Amy, and Sinclair will refuse and fail to allow Buckeye Cable to carry WNWO without Sinclair permission for the privilege and right to carry WNWO till Buckeye Cable is willing to have its subscribers be willing to pay $2 per subscribers for WNWO and used it to help launch the new cable news channel along with costs associated with Sinclair’s planned acquisition of Allbritton not yet approved by the FCC and the DOJ all under the order of ‪‎David Smith, Barry Faber, ‎David Amy‬, and Sinclair like Paramount Pictures was guilty of forcing independent movie theater owners wanting a certain film being required to take other films including films that have not been developed yet through block booking when Paramount was still controlling their movie theater operations til the end of the 1940’s under the Supreme Court order that movie studios could no longer conduct block booking behavioral practices and owned their own movie theaters to show their movies.

    Sinclair is engaging in old RKO General bribery practices by having slush funds to bribe and lobby to Congress including the House and Senate along with the NAB to claim that the retransmission consent system is working fine and don’t need to be changed to be updated for the present and future and for wanting to buy more TV stations to control in more markets and want to control 2 or more TV stations in the same TV market under the order of David Smith, Barry Faber, ‎David Amy‬, and Sinclair like RKO General was guilty of bribery for the TV licenses of the TV stations RKO General owned and control by bribing to advertisers to advertise on their stations and bribing to foreign officials along with the dishonestly of their licenses to serve the public interests til RKO General lost the final battle to keep their licenses afloat in 1987.

    Sinclair is engaging in both old rigid Paramount Pictures block booking and old RKO General bribery behavioral practices in the TV industy to abuse and misuse the retransmission consent system to use the money and fees from retransmission consent deals from the cable and satellite operators to spend it on paying to political interests and not spend it on improving the TV stations for their own survival under the interests of the broadcasters while cable and satellite subscribers have to suffer from blackouts of their favorite TV station during retransmission consent disputes caused by the TV broadcasters themselves.

    There are arguments between Buckeye and Sinclair over the carriage of WNWO:



    Sinclair has tend to lobby to congress to tell the FCC not to change the retransmission consent law and along with the NAB claiming the retransmission consent law not need to change very badly. The retransmission consent law needs to be changed very badly to reflect the present and not be stuck in the past.

    Sinclair does lobby to congress to allow them to buy and control more TV stations as they have been doing since before and after Sinclair’s deal to acquire TV stations from Allbritton including WJLA news channel that Sinclair would be planning to take it as a national news channel of their own if the Allbritton deal goes through with concession that Sinclair must spin off TV stations of their own where Sinclair and Allbritton overlap for TV stations.

    Sinclair has abused and misused retransmission consent to buy up more TV stations to control and tend to price gauge to cable operators for the privilege and right to carry the TV station within under the control of Sinclair.

    Viacom and all other cable network owners and parents and Sinclair Broadcast Group and other broadcasting group owners and parents can be guilty of engaging in old Paramount Pictures bock booking and old RKO General bribery behavioral practices when conducting retransmission consent deals with all the MSOs and the MVPDs alike.

  2. Scott says:

    Perfectly example of why I still don’t subscribe to cable or satellite. The only channel I *might* watch out of that entire lineup is Comedy Central. There’s no way I’d pay for every single Viacom channel just for that.

  3. Duffin says:

    Yep, Cincinnati Bell has been sending out Tweets and emails about this. 100% increase. Greedy bastards.

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