News Corp. said it was not likely an agreement would be reached with Time Warner Cable Inc. and Bright House Networks by midnight tonight, meaning millions of subscribers in Indiana and across the country will probably lose Fox programming on New Year’s Day.
“We deeply regret that millions of Fox customers will be deprived of our programming,” Chief Operating Officer Chase Carey said today in a memo to employees. “We need to receive fair compensation from Time Warner Cable to go forward.”
In Indianapolis, several stations will go dark, including FX, Fuel, Fox Reality Channel, Speed Channel, Fox Soccer Channel, Fox Movie Channel, Fox Sports en Espanol, Fox Sports Midwest, Fox Atlantic, Fox Pacific and Fox Central.
Local Fox affiliate WXIN (Channel 59) is owned by Tribune Co., not Fox, so it isn't part of the negotiations and won't go dark. Fox News won't either.
In larger markets, including New York and Los Angeles, they will lose shows such as “24,” “Family Guy,” “Glee” and several sporting events, including the Sugar Bowl on Friday, the Cotton Bowl on Saturday and the NFL's final regular season games Sunday.
The cable companies and Fox Broadcasting, owned by News Corp., have been unable to come to terms on a new contract on retransmission fees since midyear, Carey said.
U.S. Senator John Kerry has threatened to intervene by asking the U.S. Federal Communications Commission to force Fox to keep its signal turned on.
A day earlier, Fox rebuffed Time Warner’s request for arbitration before the FCC and declined a proposed extension that would allow Fox stations to remain on the air while the parties negotiate.
Fox spokesman Scott Grogin had no comment on the arbitration offer.
Jen Howard, an FCC spokeswoman, also declined to comment on whether the agency may mediate the dispute.
“Fox isn’t looking for fair compensation and we too are prepared to be without the Fox signal,” Time Warner spokesman Alex Dudley said. “We hope Fox doesn’t punish our customers, but that decision is up to them.”
The dispute centers on the price New York-based Time Warner, the second biggest U.S. cable operator, should pay to air football games and shows like “American Idol.” Fox wants as much as $1 a month per subscriber, two people with knowledge of the matter said. Time Warner wants about 20 cents, said one of the people.
Rich Greenfield, an analyst at Pali Capital LLC in New York, wrote that Time Warner Cable may have to pay Fox at least 50 cents a month to resolve the issue.
If Fox does get $1 a month per subscriber, other broadcasters will follow, said Craig Moffett, an analyst with Sanford C. Bernstein. That could cost consumers an additional $5 billion a year in fees.
“The American consumer is not going to win, unfortunately,” he said.