Time Warner, Ohio Net End Bitter Retrans War

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Another Time Warner Cable retransmission-consent dispute has been settled amicably.

Roughly six months after a bitter public showdown last year, Time Warner Communications and Ohio News Network have reached a one-year carriage deal that will put the all-news channel on the cable operator's digital tier throughout the "Buckeye State."

The agreement-the result of talks that started in January-provides for the addition of ONN to digital service on Time Warner's Ohio divisions in Columbus, Cincinnati, Dayton and Akron.

The MSO serves 1.4 million subscribers in Ohio. So far, it has rolled out digital in front of 861,000 homes, with roughly 90,000 actual digital subscribers to date.

In Columbus, where Time Warner has 305,000 subscribers, ONN could be on digital as soon as this summer, according to officials. It will be offered as part of the digital variety package, which includes 15 networks, as well as the premier digital package.

Late last year, Time Warner in Columbus balked when Dispatch Broadcast Group tried to tie retransmission-consent renewal for its TV station there, CBS affiliate WBNS-TV, to a carriage deal for Dispatch-owned all-news cable service ONN. Dispatch threatened to pull WBNS off cable in Columbus.

The Ohio battle turned out to be a precursor to Time Warner Cable's nuclear meltdown with The Walt Disney Co. and its ABC Inc. unit in May, when the MSO dropped the signal for ABC owned-and-operated TV stations in markets reaching 3.5 million subscribers, including New York and Los Angeles.

That Time Warner move caused an angry uproar from subscribers, the Federal Communications Commission and officials across the country.

In the bigger case, Disney was seeking carriage of some of its new cable networks, such as SoapNet, and a move of Disney Channel to basic in exchange for granting retransmission consent to Time Warner for its ABC TV stations.

That war put the spotlight on MSO complaints about media giants using retransmission consent as a bargaining chip to launch new cable networks.

In contrast to the all-out war in May, WNBS backed down after a nasty public skirmish in Ohio in December.

After a brief faceoff in court, WBNS and Time Warner signed a two-year retransmission-consent renewal in December, which expires Dec. 31, 2001. As part of that agreement, both sides agreed to negotiate for a period of 120 days on the potential carriage of ONN by Time Warner, which resulted in their just-completed one-year affiliation deal.

"When we entered these negotiations in January, it was our hope to reach an agreement that was mutually beneficial to both parties, but most important, to our customers," Time Warner Columbus division president Terry O'Connell said in a prepared statement.

"This 12-month agreement accomplishes that goal," he added. "We believe this is just the first step toward creating a long-term relationship with Dispatch Broadcast Group that brings continued benefits to the residents of central Ohio."

O'Connell said each Time Warner division would work with Dispatch to finalize launch dates for each of their areas.

During talks last year, Dispatch and ONN-which now has 450,000 subscribers-rejected Time Warner's offer to carry the all-news channel as part of its digital package. But ONN backed off that demand and agreed to digital after Time Warner agreed to carry the network statewide.

Michael Curtin, president of Dispatch Printing Co., parent of ONN and WBNS, said there were two reasons why his company decided to accept a digital deal for ONN.

First, the contract calls for ONN to be rolled out by Time Warner statewide in Ohio. "Last year, they only offered us Columbus on digital," Curtin said. "This is statewide, all four divisions. ONN is a statewide news product, and getting statewide distribution was very important."

Second, in his negotiations with Time Warner, Curtin was impressed with the cable operator's digital schedule. "I became convinced that they are committed to a very aggressive rollout," he said.

Under ONN's rate card, the network is free to operators for its first year, but from then on, its license fees escalate to 25 cents per month, per subscriber, by the fifth year. This means Time Warner will be getting ONN free-of-charge during its one-year contract.

Although Time Warner declined to give ONN an analog berth, the cable operator will add MSNBC to its analog lineup in metro Columbus this summer. Officials have said there is customer demand for MSNBC.

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