Satellite

DirecTV, Tribune Finally Nail Down a Deal

4/09/2012 12:01 AM Eastern

With the first pitch of the 2012
Major League Baseball regular
season looming, DirecTV
and the Tribune Co. managed
to pound out a retransmissionconsent
agreement with time
to spare last week, reaching
a five-year deal covering 23
broadcast TV stations in 19
markets across the country.

Tribune restored all of its local
signals and cable network WGN
America to the satellite giant’s
customers at about 9 p.m. on April
4, according to DirecTV.

The deal ended what had
been about a week of intense
negotiations between the two
parties, beginning on March
29 when DirecTV thought it
had a secured a deal. After the
satellite-TV provider issued a press release
on March 31 touting the pact, Tribune fired
off its own missive denying that any agreement
had been reached.

That turn of events surprised DirecTV’s
programming chief — executive vice president
of content, strategy and development
Derek Chang — who had hopped a plane
to start a vacation in Costa Rica after he believed
he had a deal in hand. Shortly after his
plane touched down, Chang learned that the
deal was off the table.

Both sides continued to negotiate, but
failed to reach an agreement by the midnight
March 31 deadline, and Tribune pulled
its signals, effectively blacking out its channels
to about 5 million DirecTV customers.

On April 2, DirecTV upped the ante by filing
a formal complaint (since withdrawn) accusing
Tribune of failing to negotiate in good
faith. That seemed to kick-start negotiations,
and by April 4 the two sides
had reached a compromise.

Chang added that the agreement
was basically the same
one he had hashed out with
Tribune on March 29.

“The terms we came to were
basically the same terms we
had a week ago,” Chang said.
“There was no reason to put
our customers into this position.
All these shenanigans
were for naught.”

Tribune maintained its position
in a statement.

“We’ve made it very clear
that there was no agreement
on March 29, and that an
agreement was only reached
late yesterday,
April 4,” Tribune
said. “Both parties are,
or should be, aware that
included in that agreement
is a confidential
ity clause regarding
its terms, which we
intend to honor.”

As far as Tribune’s
change of heart, Chang
speculated that the station
group realized that Direc-
TV was not going to budge from its position.

“I think they realized that we were serious,”
Chang said. “We were always willing to pay,
but we were not going to let our customers get
gouged.”

Chang also dismissed speculation that
baseball’s April 5 Opening Day played a role
in pushing the two sides to a compromise —
Tribune stations in New York, Chicago, Philadelphia
and Washington, D.C., as well as WGN
America, carry Major League Baseball games.

“I don’t think Opening Day rises to the
level of the Super Bowl or the baseball playoffs,” Chang said.

Th e Tribune negotiations won’t be the last
retransmission-consent talks for the satellite
giant this year — Chang said that DirecTV has
a continuing cycle of retrans contracts, but
declined to say when its next round of talks
are set to begin. But he added that the Tribune
experience won’t color DirecTV’s talks
with other programmers.

“We’re willing to pay something fair,”
Chang said. “In this particular instance, these
guys didn’t believe us.”

DirecTV is not backing off from its call for
retrans reform, adding that the Tribune experience
is just another example that the system
is in need of change.

American Cable Association
president and CEO
Matt Polka echoed Chang’s
sentiment, issuing a press
release last week using the
Tribune negotiations as an
example of a process that is
out of control.

“ACA is certain that millions
of DirecTV customers
callously blacked out
by Tribune Broadcasting
since April 1 are now painfully aware that
the current retrans regime is broken and no
longer serves the public interest,” Polka said
in a statement. He urged regulators to design
a new retrans system that “treats consumers
more fairly.”

March