TWC CEO Open to Arbitration in Fox Carriage Impasse
Time Warner Cable is willing to enter binding arbitration for a new contract to carry Fox affiliates owned by News Corp., CEO Glenn Britt wrote Sen. John Kerry, D-Mass. Britt said the cable operator also is open to the other suggestions floated by Kerry in his letter to both sides last week (CD Dec 23 p8) if the companies can’t end the impasse before the existing contract expires around 11:59 p.m. Thursday. FCC officials have been optimistic the sides can at least agree to a temporary extension of the existing contract (CD Dec 30 p1), but a top News Corp. executive wasn’t open to arbitration.
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“We are willing to commence an arbitration proceeding immediately before the FCC,” Britt wrote Kerry on Tuesday: “And, to prevent any disruption to consumers while the proceeding is pending, we would enter an interim agreement with FOX that applies existing terms and conditions or an interim rate subject to a true-up once a final rate is established, as your letter suggests.” If Fox won’t participate in arbitration, Time Warner Cable is willing to agree to an interim carriage agreement so Fox stations can continue to be seen by the cable operator’s subscribers from Jan. 1, Britt added.
News Corp. will continue talks with the cable operator for a new accord “in the hope of reaching a deal” before New Year’s Day but isn’t open to arbitration, President Chase Carey wrote Kerry on Wednesday. “We strongly believe that this is an issue that needs to be settled at the bargaining table and that binding arbitration all too often looks to the past, not the future,” Carey wrote. “We respectfully believe that these discussions to not belong in the hands of a third party.”
The broadcaster and cable operator appear to be continuing talks for a new carriage accord, FCC officials said Wednesday. The commission is continuing to monitor the impasse, they said. A Media Bureau spokeswoman declined to comment.
Mediacom and Sinclair executives also appear to be continuing to negotiate on a new carriage contract after their existing one also expires at 11:59 p.m. Thursday, the commission officials said. Sinclair continues to be pessimistic that a new deal can be reached before New Year’s Day, after mediation between the broadcaster and Mediacom ended Monday without an accord, General Counsel Barry Faber said. “Based on [the] current state of negotiations, Sinclair expects Mediacom to discontinue carriage of the involved stations at midnight on December 31st.” A Mediacom executive confirmed that no further mediation has been scheduled.
“We have been in communication with Sinclair and the FCC, but still have not been able to reach a deal,” Mediacom Legal and Public Affairs Vice President Thomas Larsen said Wednesday. “The FCC is still pushing us to make a deal that does not require their involvement. Obviously, we are coming down to the wire. Given the importance of events like the Orange Bowl in Iowa and BCS National Championship in Alabama, there is little doubt a shutdown by Sinclair will cause irreparable harm to consumers. If we cannot reach a deal by tomorrow, it is really up to the FCC to decide if they want use their statutory authority to protect the public.”
Meanwhile, two News Corp.-owned stations in Dallas can be seen by Time Warner Cable subscribers regardless of whether the companies reach a new nationwide distribution deal, a spokeswoman for the cable operator said. She said that’s because Fox failed to notify Time Warner Cable last year that it wanted to be compensated for that operator’s carriage of the stations: KDFI, a MyNetworkTV affiliate, and KDFW, a Fox affiliate. Since they're considered must-carry stations under FCC rules, Time Warner Cable must “carry its Dallas Fox stations on its lineup,” the spokeswoman added. “Time Warner Cable is operating pursuant to FCC rules and will not drop those channels from its lineup on January 1, 2010.”