Q. My local station on ABC is saying I could lose it this week if I have DIRECTV. Do you know about this fight and what will happen? Will I lose my channel 7 — Sadie, Clinton, Maryland.
Sadie, Sinclair Broadcast Group, which owns 136 local TV stations in 86 markets, is threatening to pull them from DIRECTV, AT&T TV Now and U-verse unless it reaches a new carriage agreement with their owner, AT&T. (In addition, Sinclair says it will remove the Tennis Channel, which it also owns.) The deadline for a new deal is this Friday at 5 p.m. ET.
Update: Sinclair stations are still on as of Saturday, September 28, at 5:50 am. The two companies are apparently still negotiating; they have not offered a comment since yesterday.
Update#2: Sinclair stations say the deadline has been extended until 5 p.m. on Sunday, September 29.
In a press release last week, Sinclair said the previous agreement between the companies was scheduled to expire in August, but they agreed to a five-week extension while negotiations continued.
As is usual in these fee fights, Sinclair says it’s asking for what other pay TV providers have already agreed to pay them to carry their signals while AT&T says the broadcaster is asking for an unreasonable increase in the old rates. Since the contracts are never made public, it’s impossible to say who’s telling the truth. But as I always say, the truth is likely somewhere in the middle.
But the real question to answer now is whether the companies will fail to reach another short-term, or long-term, agreement by Friday, which would trigger a channel blackout on the three AT&T-owned TV services.
My prediction is that they won’t sign a new pact by Friday.
While AT&T last week negotiated a long-term deal with Disney, which prevented the blackout of ESPN and other Disney-owned channels, the Sinclair situation is different.
The loss of ESPN would have led to widespread subscriber defections across the country. However, the loss of the Sinclair stations, as popular as they may be, would likely create a small viewer protest. And, more important, the impact would be contained to those 86 markets where Sinclair has local stations, not the entire country.
Consequently, it’s easier for AT&T to take a harder line in the negotiations with Sinclair than it did with Disney. By example, AT&T has been in a fee fight with Northwest Broadcast, which owns 20 local stations, for almost eight months. And the telco was in a blackout dispute with 120 Nexstar-owned local stations for five weeks over the summer before reaching a settlement.
The telco is focusing now on reducing program acquisition costs, and is more willing than normal to allow a blackout to occur to get fees down.
So the odds are good that AT&T and Sinclair will fail to reach an agreement on Friday, leading to another blackout. I may be wrong, Sadie, and hopefully I am.
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— Phillip Swann