Dish Network Corp. (DISH) customers in 17 cities lost access to several local stations owned by LIN TV Corp. (TVL) over the weekend after the companies failed to reach agreement on a new contract, the latest dispute between broadcaster and pay-TV operator to spill into the public.

On Saturday, LIN cut its signal to Dish Network, shutting down local some or all of the CBS, NBC, FOX and CW affiliates in smaller cities such as Austin, Texas, and Columbus, Ohio.

Dish and LIN are negotiating over retransmission rights, or the payment Dish makes to LIN to carry the signal to its customers. Retransmission has grown into a hot issue after several past disputes led to widescale blackouts. The Federal Communications Commission has begun looking at how the rates have been negotiated.

Dish negotiated with LIN all weekend and they continue to talk, according to a Dish spokeswoman.

"We're hopeful we can reach a fair agreement soon," she said.

LIN wasn't immediately available for comment.

Dish's optimism on Monday contrasts with the statement it issued on Saturday.

"It's unfortunate that LIN Media, a corporate media conglomerate, pulled its channels down at midnight, holding viewers in 17 markets across the nation hostage while attempting to coerce DISH Network to submit to outrageous demands," the company said Saturday, adding that LIN refused to grant an extension to its current contract.

LIN said Saturday that it would continue negotiating.

"We only want what is fair for our local stations," LIN Chief Executive Vincent Sadusky said in a statement.

-By Roger Cheng, Dow Jones Newswires; 212-416-2153; roger.cheng@dowjones.com
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