DISH DISH Network Corporation

By Keach Hagey 

Viacom Inc. said its discussions with satellite TV provider Dish Network Corp. to renew carriage of its TV channels have broken down, raising the prospect that its programming could go dark for Dish's 14 million customers as early as Thursday.

The media company, owner of networks such as Nickelodeon, Comedy Central, MTV and TV Land, accused Dish of making unreasonable demands, despite its offer of a "best-in-class" deal on rates and terms for carriage of its networks.

"We are extremely disappointed that Dish has not engaged in a serious way to reach an agreement for Viacom's number one family of cable networks," Viacom said in a statement. "Dish has made demands that are designed to be impossible to meet in order to take our negotiations public and likely force our programming off the air."

Viacom shares fell 8% on the news in early afternoon trading.

The negotiations have been closely watched on Wall Street. Monthly subscription fees from pay TV providers are a major source of revenue and profits for media companies. When some small cable operators dropped Viacom channels in 2014, investors began to worry that a bigger distributor like Dish might follow suit.

The current standoff with Dish has become an important measuring stick for Viacom to prove that its channels can continue to receive wide distribution even as cord-cutting adds pressure to the television industry.

Viacom and Dish's last agreement expired at the end of January, and the two companies have been operating under a series of short-term extensions since then. The latest of these expires at 11:59 p.m. Wednesday, according to a Viacom spokesman.

Dish said "Viacom unilaterally elected to terminate" talks despite "meaningful progress" on a new agreement and the "indefinite" nature of the contract extension.

"Viacom is asking for hundreds of millions of dollars in increases, despite the changing landscape that includes drastically reduced viewership of Viacom channels and wide availability of their content across multiple platforms," said a Dish spokesman in a statement.

Dish is known for bruising carriage negotiations with media companies and has had standoffs with other big conglomerates including Time Warner Inc., 21st Century Fox and Comcast Corp.'s NBCUniversal, as well as various TV-station owners.

Viacom, which reports earnings next week, has suffered a nearly 50% drop in its stock over the past year as investors worried about its sliding ratings that the prospect that the young-skewing audience for its networks makes it especially vulnerable to cord-cutting.

Viacom's ratings were down 3% across its portfolio for the first week in April, as gains at BET and VH1 were pulled down by a 16% drop at Comedy Central, 10% drop at Spike and 5% drop at MTV, according to an analysis of Nielsen ratings by Sanford C. Bernstein analyst Todd Juenger.

Viacom said it had begun running a crawl on its channels for Dish customers informing them of the contentious state of negotiations.

Write to Keach Hagey at keach.hagey@wsj.com

(END) Dow Jones Newswires

April 19, 2016 14:52 ET (18:52 GMT)

DISH Network (NASDAQ:DISH)
Historical Stock Chart
From Mar 2024 to Apr 2024

DISH Network (NASDAQ:DISH)
Historical Stock Chart
From Apr 2023 to Apr 2024