Scripps, Cablevision Reach A Compromise1/25/2010 2:00 AM Eastern
Three weeks into their seemingly endless carriage battle, Scripps Networks Interactive and Cablevision Systems reached a deal on Jan. 21 that returned HGTV and Food Network to the New York area MSO's 3.1 million subscribers.
Terms of the deal were not disclosed. In the past, Cablevision had complained that Scripps was seeking to triple the 25 cents per-subscriber, per-month rate the MSO paid for the two channels combined. Scripps countered that it was asking for fair value for its networks, which have grown substantially over the past few years.
Neither Cablevision nor Scripps would comment on the specifics of the deal, which according to some sources is a long-term pact. Collins Stewart cable and satellite analyst Tom Eagan, while not claiming specific knowledge of the agreement, said that it most likely involved a compromise that both companies can live with.
“What I'm wondering is whether it went beyond rates; whether they got creative and found a way not to impact SNI's [most-favored-nation agreement] but yet still get a deal that was acceptable for both parties,” Eagan said. “For example, would SNI give up any incremental ad minutes?”
Miller Tabak media analyst David Joyce said getting incremental ad minutes would be a novel concept for Cablevision, adding that there may be an opportunity on the interactive ad front for both parties.
“I think there is a great opportunity for Food Network & HGTV programming to lend itself well to interactive/RFI advertisers, which could benefit both Cablevision and Scripps in the future,” Joyce said.
Scripps had already reached carriage deals with the National Cable Telecommunications Cooperative, which represents more than 24 million subscribers, and others. Chairman and CEO Ken Lowe said prior to the beginning of the year that Food Network deals with every major distributor except Comcast were up for renewal on Jan. 1. A deal with Time Warner Cable is still being negotiated and according to people familiar with the situation, is nearing a conclusion.
And while it was contentious at times, Scripps and Cablevision executives appeared pleased that the deal is done.
“This is the resolution everyone wanted,” said John Lansing, executive vice president of Scripps Networks Interactive Inc. and president of the company's Scripps Networks operating division, in a statement. “Cablevision has been a valued distribution partner and we're gratified that together we were able to reach a successful conclusion that will benefit their customers and viewers of our networks.”
John Bickham, Cablevision's president of cable and communications, said: “We'd like to thank our customers for their patience and understanding as we worked with Scripps to reach an agreement that is fair. Food Network and HGTV have strong and loyal followings and we are pleased that both channels are back where they belong on Cablevision and available to our customers in both standard-definition and free HD.”