Indie Nets Facing Drops

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Several independent networks should beware the Ides of March as cable and satellite distributors — looking to cut operating costs and provide better value to consumers — are considering dropping or repositioning services that hold little if any negotiating power.

As soon as this week, Time Warner Cable in several markets plans to either drop or move to less-penetrated tiers such networks as GSN, The Outdoor Channel and AmericanLife TV Network in a “periodic review of its channel lineups.”

SATELLITE JEOPARDY

Other programmers that sit outside the big media conglomerates’ programming stables, such as Starz Entertainment Group and Court TV, could be feeling pressure from cable and satellite companies as their carriage agreements expire soon.

In general, distributors said they’re becoming more concerned about which networks they carry.

“I think you will see more and more assessments of different networks’ worth versus their license fees versus their viewership,” said Jerry McKenna, Cable One Inc.’s vice president of strategic marketing. “When there’s an imbalance, I think you will see more and more operators taking a firmer stand.”

Time Warner notified these programmers of its planned changes:

  • GSN, which would be dropped in Binghamton, N.Y., this week and in New York City in May, The moves make room for new regional sports channel SportsNet New York, which is partially owned by Time Warner.
  • The Outdoor Channel, which would be dropped in the San Diego and Waco, Texas, systems and shift to a digital sports tier in Binghamton from digital basic.
  • Animal Planet and G4, which would move to a digital tier in Northeast Ohio, from expanded basic.
  • AmericanLife TV, which would be dropped from the Ohio, Binghamton and San Diego systems

Time Warner cited many factors, including cost, the network’s investment in new programming and overall ratings.

“It is also occasionally necessary to make room on a particular channel lineup for new, potentially more popular networks,” the cable company said in a statement.

The No. 2 U.S. cable operator is looking to add Comcast Corp.-controlled TV One; Boomerang, owned by Time Warner Inc.’s Turner Broadcasting System Inc.; and several ethnic-targeted networks, including Hispanic-aimed La Familia.

A Time Warner Cable spokesman would not identify where the networks would launch.

While Time Warner said it’s taking advantage of expired or expiring carriage deals, Outdoor maintains it has long-term contracts. But without marketplace leverage, it’s difficult to fight the changes.

“We’ve given them flexibility on carrying our channel because we don’t have [retransmission consent] and we don’t have the big clubs that the big conglomerates can use on Time Warner,” Outdoor CEO Andrew Dale said.

AmericanLife TV is in talks with Time Warner to try to keep its carriage intact, according to Richard Freedman, the channel’s senior vice president of affiliate sales and marketing.

GSN CEO Rich Cronin’s network also is continuing to negotiate. “If you look at the three things they cite —cost, ratings and programming investment — we’re reasonably priced, we’re more popular than any mid-sized network and we’ve made a huge investment not only in programming but in interactivity,” he said. “We’re a broad-appeal, family friendly network, something that is really important to cable.”

Independent networks have more to fear than just Time Warner.

Starz’s agreement with Dish Network expired March 8, but an extension was granted until March 15. The premium service’s affiliation deal with DirecTV Inc. will expire March 31. The parties declined to comment last week.

Court TV is currently out of contract with three distributors that represent about 26% of its subscribers, according to a securities filing last week by the network’s half owner, Liberty Media. Court TV doesn’t comment on negotiations, a spokeswoman said.

PAX FACES DIRECTV DROP

DirectTV, alleging a contract violation, has dropped Paxson Communications Corp. programming in five markets because of its repositioning of its Pax TV network as i: Independent Television.

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