CBS Pulls Signals Off Dish Network After Fee Talks Fail

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CBS Corp., owner of the most-watched broadcast network, pulled its signal from the Dish Network Corp. satellite-TV service after the companies failed to reach a new agreement on program fees.

The blackout was imposed in New York, Los Angeles and other major markets at 7 p.m. New York time yesterday, CBS said in a statement. Dish is the third-largest U.S. pay-TV provider, with 14 million subscribers.

The blackout, in markets where CBS owns stations, highlights the growing divide between pay-TV services like Dish and media companies like CBS and Time Warner Inc. that are seeking higher rates for programming in every new negotiation. Programmers are also seeking compensation for digital services like the one Dish is trying to start.

“What CBS seeks is appropriate compensation for the most-watched television network with the most popular content in the world, as well as terms that reflect the developing digital marketplace,” the New York-based network said in a statement.

The blackout means subscribers of Englewood, Colorado-based Dish will lose shows including “NCIS,” “60 Minutes” and some National League Football games.

“We are disappointed that CBS has chosen to black out their local channels, but remain optimistic that the channels will return quickly as both sides are continuing to work tonight to finalize an agreement,” Dish said in a separate statement.

Companies on both sides of the negotiating table have pursued multi-billion dollar mergers to increase their bargaining leverage. Government regulators are examining Comcast Corp.’s proposed acquisition of Time Warner Cable Inc., which would unite two of the largest cable operators in the country, while 21st Century Fox Inc. failed in its quest to acquire New York-based Time Warner, owner of HBO and CNN.

Weekend Games

In addition to NFL games this weekend, CBS is scheduled to air the championship football game of the Southeastern Conference, routinely one of the most watched college games of the season. If the dispute drags on through March, it could affect viewing of some National Collegiate Athletic Association March Madness basketball tournament games.

Dish is also negotiating a new programming pact with Time Warner Inc.’s Turner Broadcasting, owner of TBS and TNT.

A blackout could be costly for Dish. Time Warner Cable lost 300,000 customers in one quarter last year after dropping CBS in a contract dispute. After a public standoff, Time Warner Cable agreed to pay CBS significantly more for its programming.

Adding to the stakes, Dish has been seeking rights to stream TV over the Internet to computers, tablets and phones.

Dish plans to be one of the first pay-TV companies to start a streaming service. The company made a deal with Walt Disney Co. in March to gain online rights for the Disney Channel, ABC and ESPN.