Cable subscribers, beware: starting at 12:01 a.m. Tuesday, you might flip to VH1 or Spike TV only to find that those channels have been blacked out or replaced with other programming.
Thanks to deadlocked contract negotiations with Viacom, as many as 5.2 million customers of around 1,000 cable providers could lose access to those and other major channels, such as MTV and Comedy Central. Companies that may be affected include Wide Open West in Denver, Colo., Hargray CATV in Hilton Head, S.C., and Wave Broadband in Kirkland, Wash.
At issue is Viacom's request for higher licensing fees from the National Cable Television Cooperative, a group of smaller cable operators each with a median size of 1,500 customers. If the two don't come to an agreement by March 31, their existing contract will expire, and Viacom will pull its programming.
The American Cable Association, which backs the NCTC, says there's a kind of irony in the discussions.
"You can look at [Viacom's] content over time," said ACA's Matt Polka. "Their ratings are declining. So we're in this bizarre situation where our members — and their customers — are paying more for content that is declining in popularity."
Viacom declined to comment.
In some ways, the dispute is reminiscent of a struggle last year between Time Warner Cable (TWC) and CBS, the latter of which pulled its programming over content fees and caused a weeks-long blackout for TWC customers. Federal regulators have signaled their interest in preventing TV broadcasters, who receive payment from cable companies in exchange for content, from banding together in negotiations with cable carriers.
The difference in this case is that the content provider, Viacom, is outnumbered by the cable companies. Broadcasters are taking advantage of that to argue that NCTC is doing the same kind of collective bargaining that the Federal Communications Commission said it wants to block among TV stations.
However if this resolves itself, it'll have big implications for the ongoing tussle between distributors and content providers.