About 1.1 million Suddenlink Communications video customers across the country could lose access to Viacom networks like Nickelodeon, MTV and Comedy Central on Sept. 30, if the two don’t come to a renewal agreement.
So far, it doesn’t look too good that a deal will be reached in time.
According to Suddenlink’s website – SuddenlinkOnYourSide.com – Viacom is asking for a significant increase in affiliate fees, which the cable operator believes is unwarranted.
“Because Viacom still demands a significant pay increase, despite declining viewership, Suddenlink asked for a price for only the Viacom channels (like TV Land, Comedy Central, and others) that our customers watch the most,” Suddenlink said on the site. “Viacom responded by further increasing its price demands.”
Suddenlink claims that viewership at some Viacom channels has dropped by as much as 30% over the past few years.
If the two can’t reach a deal, that could mean that more than 1.1 million Suddenlink video customers in Arkansas, Louisiana, North Carolina, Oklahoma, Texas, West Virginia, and elsewhere would lose access to such popular shows as MTV’s Teen Wolf (pictured), Comedy Central’s The Daily Show and The Colbert Report and kids’ programming from Nickelodeon like The Haunted Hathaways and SpongeBob Squarepants.
Suddenlink’s stance seems similar to one taken by another small market operator – Cable One – earlier this year. Cable One, citing declining viewership, had wanted to pay only for channels that its 700,000 video, voice and data subscribers watched, not Viacom’s entire suite of 22 networks. Viacom argued that Cable One and all distributors have the opportunity to buy channels a la carte – which Cable One said was prohibitively expensive – but that most distributors opt to buy all of its networks, which it claims is a better value. Cable One dropped the Viacom channels in April and has not yet reached a deal with the programmer. The cable operator replaced the Viacom channels with networks such as BBC America, Sprout, The Blaze, Hallmark Channel, National Geographic, Investigation Discovery, TV One and Sundance TV.
"Suddenlink¹s statements are all part of their negotiation playbook," Viacom said in an e-mail message. "The increase we are asking for is fair. Viacom's networks are the best performing cable network group and account for nearly 20% of all cable viewing. Additionally, we drive nearly a third of all video on demand viewing by Suddenlink customers. Suddenlink paid more for ESPN Networks in the deal it just completed than we're asking for all 24 of our networks combined, even though we deliver far greater value. We are continuing to make every effort to reach an agreement with Suddenlink."
The loss of Suddenlink could be a blow to Viacom – Suddenlink has twice the subscribers as Cable One -- but the absence of popular programming also could dent the St. Louis-based cable operator. Cable One, a division of publicly traded Graham Holdings, lost about 34,254 video customers in the second quarter, its first full three months without the Viacom channels. That's more than double the 14,000 it lost in the first quarter and nearly three times the 12,400 it lost in the second quarter last year, according to Graham's financial statements. While several factors could have led to the increased subscriber losses, the inability to carry the Viacom channels was likley a component.