Ergen Rips Lifetime

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Las Vegas -- EchoStar Communications Corp. chairman Charles Ergen Thursday blasted Lifetime Television for demanding an “outrageous” license-fee increase and added that direct-broadcast satellite companies are no longer willing to pay programmers a special premium above what cable operators shell out for networks.

“In my experience in 25 years, I’ve never seen such an outrageous demand for payment in my life, from a contractual point of view,” Ergen said during a press conference at the 2006 International Consumer Electronics Show here.

Ergen -- who said he’s had a good relationship with Lifetime for 10 years -- charged that the programmer has proven to be even greedier than what he called “the most greedy” programmer, ESPN.

EchoStar’s Dish Network dropped Lifetime and its sister service, Lifetime Movie Network, New Year’s Day in a contract dispute. The programmer’s contract with Dish expired Dec. 31, and the two parties couldn’t come to terms on a new deal.

During a press question-and-answer period after EchoStar outlined its plans for this year, Ergen fielded a question about the dispute with Lifetime. Now that it’s off, it will be tough for Lifetime to get back on Dish, said Ergen, who was prepared for press inquiries about the women’s network and had several slides made up to illustrate his points, including his claim that the programmer was seeking a 76% rate increase over a three-year period.

For their part, Lifetime officials, apprised of Ergen’s comments, issued the following statement:

“As a matter of policy, Lifetime does not negotiate in the media or comment on the status of negotiations. But there have been so many false statements made by Dish that we feel the need to set the record straight on behalf of the millions of women who watch our programs.”

Lifetime’s response added that Dish is “continuing to mischaracterize our most recent reasonable contract proposal,” which “we believe still would amount to far less than what Dish pays for less popular networks.”

Additionally, Lifetime said, the final proposal from Dish -- which, it added, has not returned to the negotiating table -- called for “a drastic reduction” in rates that would “inhibit” the network’s ability to produce top-quality programming.

Ergen -- who said Dish had successfully completed 318 out of 320 contract negotiations last year, with Lifetime and OLN being the exceptions -- noted that the dispute “really boils down to economics,” with programming costs rising more than the rate of inflation, 6%-8%.

He added, “The DBS industry, when we were new, paid a DBS premium … But now that the second- and third-largest MSOs in the country are DBS guys, it’s our opinion -- compared to the DBS premium -- we should get the same rate as cable.”

To get back on Dish’s lineup, Lifetime will be in the “new-entrant” category and have to compete with any other network that wants to be carried on the DBS service, Ergen said, asking, “Why would we put something back up again when we’ve lost the customers who watch it?”

A Lifetime spokesman said the network has received e-mails from several-thousand viewers expressing disappointment and anger over the networks’ absence on Dish.

Citing data from Beta Research Corp.’s 2005 satellite-subscriber study, officials at Lifetime said it ranked first among all female satellite subscribers among full-sized networks (70 million or more homes), while LMN was tops among female satellite subscribers among midsized networks (40 million-70 million homes).

Mike Reynolds
contributed to this story.

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