The network will premiere the Kiefer Sutherland-starring drama series on Monday, January 7 at 8 PM and air all eight seasons of the Emmy-winning Fox drama in HD Monday through Thursdays. The television movie 24: Redemption will air in advance of Season 7, DirecTV said. It’s the latest move for the satellite provider’s Audience Network, which is now in production on its first original series Rogue starring Thandie Newton, and rescued NBC’s Friday Night Lights and FX’s Damages. It also has been rumored to be among the networks interested in reviving AMC’s The Killing, which was cancelled in September. A production of 20th Century Fox Television and Imagine Television, 24 was created by Joel Surnow and Robert Cochran and premiered on Fox in 2001.
Gannett offers no details, except that it has “reached an agreement” that will enable DirecTV to continue retransmitting signals from its 23 television stations. Gannett had warned viewers that a “signal disruption” was possible if the companies remained …
Listen to Episode 10 of our audio podcast Deadline Big Media With David Lieberman. This week, Deadline Executive Editor Lieberman and host David Bloom discuss how Quarter 3 earnings season turned out; whether DirecTV and Dish Network should merge; Cinemark’s smartphone app Cinemode to encourage people not to use their smartphone during movies; and growing uncertainty over Google plans to renew funding deals with more than 100 original-content channels on YouTube.
UPDATE, 1:55 PM: Lakers fans in LA can officially rejoice (unless you have Dish Network, that is): DirecTV will launch Time Warner Cable SportsNet and Time Warner Cable Deportes today for all Southern California customers, it said in a just-issued release (see it below the original story). Time Warner Cable SportsNet will be available for on channel 691 throughout Southern California (Los Angeles, San Diego, Bakersfield and parts of Fresno) as well as Santa Barbara and Ventura counties, Las Vegas and Hawaii. Time Warner Cable Deportes will be available on channel 458.
PREVIOUS: 11:52 AM: We’re hearing an official announcement is coming soon that will say the satellite provider has agreed to a deal to carry the LA Lakers’ new broadcast home on Time Warner Cable SportsNet and its Spanish-language sibling Time Warner Cable Deportes. The companies have been in negotiations, but DirecTV like others had been balking at a reported $3.95-per-sub-per-month asking price for the new regional sports networks. The Lakers’ 20-year deal with the TWC properties kicked off on Halloween, but DirecTV customers haven’t seen them play yet. If a deal was reached, it means Dish Network is the only holdout among Southern California providers. Stay tuned.
That long-debated question on Wall Street took on new urgency today after Bernstein Research’s Craig Moffett bet that the companies will make a deal, and that it will be approved by the FCC and antitrust officials. This morning he raised his target stock price for each company by $9 (to $72 for DirecTV and $37 for Dish) “to reflect the increased probability of a merger.” Why now? Dish seems to have leverage over the FCC, which wants to promote competition in broadband and telephony more than it wants to block media mergers. Charlie Ergen’s company has been amassing wireless spectrum that “offers the prospect of either a fixed wireless broadband network to compete with cable, or, alternatively, a new competitor for mobile wireless to compete with Verizon and AT&T,” Moffett says. “Either would be a tremendous regulatory (and political) win” for the government. By year-end regulators likely will help their cause, and Ergen’s, by giving Dish permission to use its spectrum for terrestrial services. But the approval will include a timetable requiring Dish to deploy its services quickly. That gives Ergen the opportunity to tell regulators that he’ll proceed — but only if they enable Dish to combine with DirecTV, Cost savings and other benefits could amount to $3.5B a year, which Moffett says is “a staggering sum.”
DirecTV CEO Mike White is no stranger to taking a stand against rising programming costs, pulling 16 Viacom channels off his service during the summer for 10 days before reaching a carriage deal. Now his company and Dish Network are the lone pay TV providers serving Southern California who don’t have an agreement to carry the LA Lakers’ newly created TV homes: Time Warner Cable SportsNet and Time Warner Cable Deportes. The satellite companies are balking at the $3.95-per-sub-per-month price that TWC reportedly wants. (Verizon, AT&T, Charter and, as of today, Cox Communications have made deals and are carrying the channels.) DirecTV, with about 1.2 million subs in SoCal, also is holding out on making a deal for a third rookie regional sports net, the Pac-12 Networks. It says that costs are out of control. (A fine Sports Business Journal report on the LA mess calculates providers must pony up about $10 per sub per month to carry all the RSNs in town). White was, well, direct during his company’s earnings call yesterday when asked about negotiations. Sounds like the Lakers, who play their fifth game of the season tonight in Utah, won’t be on DirecTV anytime soon:
In terms of Los Angeles, I think it’s another example of how broken this system is. People take the same content, package it up, bid it up for 3 times the national average on a per-game basis and then try and stick it back to the other distributors in the geography. And I think that’s very unfortunate. We have a system of very carefully tracking churn by day to look at kind of what we think our customers will be most interested in. We are continuing to have active discussions about the Lakers network. We hope to have a deal on that content. But all of these new channels that – everybody here wants a new channel and they want to stick it into the bundle, is not right. I mean we are taxing most of our customers who wouldn’t be willing to pay for that content. And I’ve said before, I think the regional sports network structure in the industry is broken. And it is. But I’m probably not going be able to change that overnight. But adding other stuff to the bundle that the average consumer can’t pay for without allowing it to be sold to those that want to pay for it is just not right. So we’ll continue to stand strong for our customers.
Analysts may overlook some of the encouraging numbers in the satellite company’s latest earnings as a higher-than-expected churn rate resulted in disappointing growth in domestic subscriptions. DirecTV ended up with net income of $572M, +9.8% vs the period last year, on revenues of $7.42B, +8.4%. Revenues were a hair above the $7.41B that the Street expected. But earnings per share at 90 cents missed projections for 93 cents — and the results would have been lower without a $39M “other gain.” The U.S. business generated $5.77B in revenues, +6.4%, with an operating profit of $876M, +9.5%. The gains were partly due to price increases, higher sales of premium services, and an extra week of NFL Sunday Ticket vs last year. But the standout figure is the 19.98M domestic subscriber number — up just 67,000 vs last year’s gain of 327,000. The company says the slowdown is largely due to a rising churn rate “principally driven by a contract dispute” with Viacom.
That’s part of a new carriage agreement between the companies announced this morning. The No. 1 satellite company committed to offer ION Media’s flagship network in HD and with separate feeds for the East and West coasts. This …
DirecTV CEO Michael White kept the ember of this long-standing idea burning this morning at the Goldman Sachs Annual Communicopia Conference. “Consolidation could be pro-consumer, perhaps,” he told investors, citing, among other things, the soaring programming costs for DirecTV and other pay TV providers. White says that outlays for popular channels are growing “at an unsustainable rate for consumers.” (That includes DirecTV’s higher payments from its new deal with Viacom, although White says that “we ended up better off” after the companies’ recent showdown.) This would be an awkward time to pursue a deal. Dish Network chairman Charlie Ergen has been amassing rights for wireless spectrum and “we have to see what he has in mind to do with it,” White says. Verizon, AT&T, Sprint, and T-Mobile already are well established in the wireless phone business. “It’s hard for us to see why we’d ever want to go in and compete in that space.” DirecTV would like to offer broadband services, but White says it probably makes more sense to partner with a provider.
Was Viacom’s showdown last month with DirecTV worth the trouble? It was from Viacom’s view, CEO Philippe Dauman told analysts this morning. The final terms were “materially better for Viacom than the deal that was on the table” at the beginning of the nine-day period when the company’s 17 channels went dark at the homes of DirecTV’s 20M subscribers. “We are extremely pleased”. The impact will show up on Viacom’s next earnings report, due in about three months. But Dauman says his company’s ad losses will roughly equal the total sales for the BET Awards, which aired July 1. “They basically cancel each other out”, he says — which means the underlying business is showing “core sequential improvement.” The rate hike for DirecTV in the 7-year deal will be “significantly more than 20%” right away with “annual increases in excess of the prior agreement”. He’s also pleased that DirecTV will begin to offer some Viacom channels in Latin America. “We expect that to create additional value”, Dauman says. “The world presents a lot of opportunities for us.” He also noted that DirecTV has a year to pick up premium channel Epix on pre-negotiated terms but says that “the decision will be their’s.” Despite all of the improvements for Viacom, Dauman says that DirecTV “will be a lower percent of our revenues in the coming years”.
DirecTV seems to have the edge in my non-scientific checks with industry watchers who monitored the contract dispute that for 10 days prevented 20M satellite customers from seeing Viacom’s 17 channels. But there are champions for both sides — and nobody outside of the companies knows enough about the financial terms to make a solid case for his or her view. Here’s what I’m told: DirecTV’s first year payment to Viacom in the seven-year deal is a double-digit percentage step up from what it was paying before, but less than the 30% that DirecTV said Viacom initially wanted. After that, DirecTV’s outlay for Viacom’s channels will rise by mid-single digit percentages each year. The deal gives DirecTV the right to stream Viacom programming to its customers — both inside and outside of their homes — via the satellite provider’s TV Everywhere program. And it doesn’t have to carry premium movie channel Epix, but has the option to pick it up.
DirecTV’s 20M customers have their MTV – and 16 other Viacom channels – again. The companies said this morning that they’ve resolved their 10-day contract dispute, which took more channels from more consumers than any other fight so far between a pay TV distributor and programmer. That will come as a relief to DirecTV customers who are fans of channels including Nickelodeon, Comedy Central, BET and Spike. Investors also will be glad to see an end to what many feared could have become an extended black out that might trash both companies’ earnings. In addition, Hollywood moguls will be pleased: Several have told our Nikki Finke that they’ve found it hard to promote movies while Viacom’s youth-oriented channels have been dark in so many homes.
Negotiators spend just “10 minutes a day talking” about substantive matters says Denise Denson, Viacom Media Networks’ EVP for Content Distribution and Marketing. “I don’t see it ending any time soon.” Viacom’s 17 channels went dark for DirecTV’s 20M customers early last week. Afterward Viacom CEO Philippe Dauman offered a compromise proposal to DirecTV CEO Michael White while they were both at the Allen & Co confab in Sun Valley. “Philippe hasn’t heard personally back from Mike since,” Denson says. In her view DirecTV is dragging things out because “in the short term the programmer does feel the pressure from the loss of subscribers.” The satellite company was “bullied into this by their investors” and wants to send a signal to other programmers not to ask for big price increases. But she says that DirecTV is being disingenuous with its subscribers by urging them to hang on in the hope that a resolution could come soon. “It’s completely misleading,” she says. “It is unfair to the consumer that they don’t have the facts.” If they did, and switched to a rival pay TV provider, then “it would be very difficult for DirecTV in the long run.”
Word is that negotiations are still moving slowly. And that could mean Viacom’s in for a lot of pain based on Nielsen data from the first week in which its 17 channels were dark on DirecTV. The black out began on July 11, which means that Viacom networks didn’t have DirecTV’s 20M subscribers for five days in the week that ended July 15. During that week, there was a 27% drop in the total day live viewing for the target audiences of Viacom’s networks compared with the same period last year, according to a compilation of ratings data by Barclays Capital. The previous week the networks collectively were -14%. Those with the steepest year-over-year drops were Nick at Nite (-48.1%), Nickelodeon (-45.0%), VH1 Classic (-35.3%), Nick Toons (-34.8%), and CMT (-32.0%). Viacom’s more resilient channels were VH1 (-1.3%), Teen Nick (-2.5%), Comedy Central (-5.5%), BET (-13.0%), and TVLand (-18.1%).