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News Corp. Yanks Local Fox Stations from Cablevision

 & Chloe Albanesius Executive Editor, News

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News Corp. on Saturday yanked its Fox broadcast programming from Cablevision after the two companies failed to reach an agreement over licensing fees.

Cablevision customers who tried to tune into local Fox stations in the New York tri-state area were met with a taped message from Cablevision claiming that "corporate greed" has left viewers without access to their favorite TV shows. Fox cable channels are not affected.

Cablevision currently pays News Corp. $70 million each year for access to its programming, but News Corp. now wants $150 million. "That's an $80 million fee increase for the exact same programming," Cablevision said in a statement.

News Corp. wants more for Fox 5 than Cablevision pays for CBS, NBC, ABC, and Univision combined, Cablevision said. The cable provider characterized the move as an "act of corporate greed" and an "unfortunate attempt to extort unreasonable and unfair fee increases."

"This was News Corps's decision; not our," Cablevision said. "We want to keep these channels on the air while we negotiate a fair agreement."

News Corp., however, said its demands were fair because it produces some of the most-watched TV programming.

"The bottom line is that the Fox stations feature some of the nation's most-watched programming with shows such as American Idol, House, Glee, and The Simpsons, as well as the most compelling sports on television with the National Football League, Major League Baseball, and NASCAR," News Corp. said in a statement. "The price Fox is asking for as compensation for all this value is extremely reasonable."

News Corp. said that broadcasters must rely on advertising for revenue, while cable providers get advertising and subscriber fees. Cablevision is "charging subscribers for free, over-the-air broadcast programming but not sharing one penny with broadcasters," News Corp. said.

Cablevision customers are no doubt used to these battles. Earlier this year Cablevision customers missed the beginning of the Academy Awards when ABC pulled its content from Cablevision over similar licensing battles. And in January, Cablevision customers were without HGTV and the Food Network for nearly three weeks while Cablevision and Scripps Networks Interactive, which owns the networks, battled over fees.

Cablevision and News Corp. have set up their own Web sites to argue their cases – Cablevision at cablevision.com/fox and News Corp. at keepfoxon.com.

Regulators urged both sides to reach an agreement.

Federal Communications Commission Chairman Julius Genachowski said he was disappointed that Fox stations have gone dark.

"Each year, thousands of agreements between broadcasters and pay-TV providers are reached without interruption of customer viewing. I remain hopeful that these two companies will do what is in the best interest of consumers and find a way quickly to resolve their differences," Genachowski said in a statement. "While federal law provides that the terms will be set by agreement between private companies, Fox and Cablevision share responsibility for protecting their audience's interests. I expect both companies to live up to this responsibility."

Sen. John Kerry, a Massachusetts Democrat, echoed those sentiments and said he will introduce legislation "that would stave off the termination of carriage of signals upon the expiration of an agreement and allow signals to continue transmitting until the FCC evaluates the last best offer of the firms, determines whether they were made consistent with good faith negotiation and market conditions, and if they were, then recommends or does not recommend binding arbitration during which carriage would continue."

Rep. Edward Markey, also a Massachusetts Democrat, said he heard reports that access to Internet-based video from Fox is being blocked selectively for Cablevision broadband customers.

"This is not only contrary to the [FCC's] Broadband Internet Policy Statement of 2005, which states, in part, that '...consumers are entitled to access the lawful Internet content of their choice,' [but the] tying of cable TV subscription to access to Internet fare freely available to other consumers is a very serious concern," Markey said. "Consumers are losing their freedom to access the Internet content of their choice - through no fault of their own - and this is patently anti-consumer."

About Our Expert

Chloe Albanesius

Chloe Albanesius

Executive Editor, News

My Experience

I started out covering tech policy in DC for The National Journal, where my beat included state-level tech news and all the congressional hearings and FCC meetings I could handle. I later covered Wall Street trading tech before switching gears to consumer tech. I now lead PCMag's news coverage.

My Areas of Expertise

Getting my start in DC means I still have a soft spot for tech policy; Congressional hearings can sometimes be as entertaining as a Bravo reality show, for better or worse. But PCMag is all about the technology we use every day, as well as keeping an eye out for the trends that will shape the industry in the years ahead (or flop on arrival). I've covered the rise of social media, the iOS vs. Android wars, the cord-cutting revolution that's now left us with hefty streaming bills, and the effort to stuff artificial intelligence into every product you could imagine. This job has taken me to CES in Vegas (one too many times), IFA in Berlin, and MWC in Barcelona. I also drove a Tesla 1,000 miles out west as part of our Best Mobile Networks project. Of late, my focus is on our hard-working team of reporters at PCMag, guiding and editing their robust coverage.

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