Tegna Reaches Agreement With AT&T to Avert DirecTV Blackout

  • DirecTV, U-verse customers to keep getting 46 local channels
  • Dish Network customers were blacked out in similiar situation

Tegna Inc., which operates television stations and consumer websites, reached an agreement to continue providing customers of AT&T Inc.’s DirecTV and U-verse access to 46 local channels in the U.S., ending the threat of a blackout. 

AT&T had disputed the fees requested by Tegna to carry the stations, which include WFAA-TV in Dallas, where AT&T is based. Though the companies’ previous accord expired at midnight Dec. 4, Tegna and the DirecTV and U-verse units had agreed to a 24-hour extension to negotiate.

Tensions have grown as broadcasters demand higher rates from cable- and satellite-TV providers that deliver their programming to consumers, increasing the number of blackouts this year. Fees paid to broadcast networks and stations by subscription-TV services may jump 21 percent to almost $6 billion this year, and 90 percent to $9.3 billion by 2020, according to data compiled by Bloomberg Intelligence.

Part of the rationale for AT&T’s $48.5 billion purchase of DirecTV was to increase bargaining power in such negotiations. The company saw the combination of its 6 million U-verse TV customers with DirecTV’s 20 million satellite-TV customers as a way to gain leverage over broadcasters like Tegna, thus lower programming costs.

No terms of the multi-year agreement were disclosed in a statement released Saturday.

McLean, Virginia-based Tegna, the former broadcasting and digital businesses of Gannett Co., was locked in a similar dispute last month with Dish Network Corp. After a two-day blackout, the companies reached a new agreement on Oct. 11 that restored customers’ access to local channels in 38 U.S. markets.

AT&T recently renewed deals with TV-station owners Tribune Media Co. and Media General Inc.

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