Viacom says there's ‘no deal in sight’ to get channels back on DirecTV
It's hard to distinguish who's behaving like the bigger drama queen when it comes to the recent carriage fee dispute between DirecTV and Viacom. For the moment, DirecTV seems to be inching ahead, according to a Viacom blog post published this afternoon.
Context & Ripple Effects
Viacom took its channels dark on DirecTV in a carriage-fee fight and is now managing the message through its own blog, conceding there is 'no deal in sight' while arguing — per a post the wider press read as an admission — that DirecTV is inching ahead. The pickup across CNET, Engadget, CNNMoney and others within a day shows how much attention these blackouts now draw.
This is Viacom's second high-profile distribution fight in little over a year: it abandoned its legal battle with Time Warner Cable over iPad streaming in mid-2012 after Time Warner Cable had earlier sought a declaratory judgment against Viacom, so counterparties are negotiating against a programmer with a recent record of backing down from escalations.
First-order effects
- DirecTV subscribers immediately lose access to Viacom's cable networks, and both companies are now competing for public sympathy through dueling statements rather than at the table.
- Viacom's own blog framing that DirecTV 'seems to be inching ahead' hands the distributor a PR advantage while the blackout costs Viacom affiliate revenue every day it lasts.
Second-order effects
- Rival distributors such as Dish and cable operators can pitch switchers during the outage, turning Viacom's leverage play into a subscriber-recruitment window for DirecTV's competitors.
- Every other programmer negotiating renewals with DirecTV watches whether holding out or settling first yields better terms, calibrating their own fee demands accordingly.
Third-order effects
- If blackouts keep proving to be losing PR gambits for programmers, carriage renewals shift toward quieter brinkmanship — or toward distributors gaining standing to resist annual fee escalations outright.
- Sustained fee pressure pushes pay-TV distributors to weigh non-traditional channel sources, eroding the bundled-affiliate model that programmers like Viacom depend on.
The trend: Pay-TV carriage disputes are escalating into public blackouts as programmers chase higher affiliate fees and distributors increasingly refuse to blink first.