AMC Networks’ unfair contract renewal demands mean more than 200,000 cable TV subscribers across North and South Carolina could soon lose AMC if a new deal is not reached by December 31st. AMC’s demands highlight a growing problem behind cable TV price hikes and the burdens they place on independent cable TV companies and their customers.
Independent cable TV companies, which represent more than 200,00 subscribers across North and South Carolina, are saying, “NO” to the unfair contract renewal demands proposed by AMC networks. The company, which owns AMC, WE, IFC, and others, is demanding programming fee rate hikes of as much as 200 percent in some cases. In addition to the unprecedented fee increase, AMC Networks is also mandating the addition of several less popular channels and payment for all customers regardless of whether their package includes AMC.
South Carolina independent cable TV operators Comporium, Horry Telephone Cooperative (HTC), Home Telecom, Hargray Communications, Chesnee Communications, and Tru-Vista Communications, along with North Carolina’s Atlantic Telephone Membership Corporation (ATMC), Star Communications, SkyLine/Skybest, Surry Communications (STMC), Piedmont Communications Services Inc., TriCounty Telecom, and Morris Broadband, are all members of the National Cable Television Cooperative (NCTC), a not-for-profit consortium of independent cable TV providers that negotiates contracts on behalf of more than 700 members spread across the country. NCTC is diligently negotiating with AMC Networks to try to avoid the loss of AMC in more than four million homes.
It is the goal of NCTC to negotiate programming fees on behalf of a group of hundreds of small and independent cable TV operators that are lower than any of these operators could secure on its own. “There comes a point where you have to say ‘enough’. That point is now,” said Allen Russ, ATMC Chief Executive Officer. “Our customers are already saying they are tired of paying for channels they aren’t watching. AMC’s current offer would only make that issue worse and possibly push our customers to look to other entertainment options.”
“We want our customers to know that network programming fees account for the vast majority of their monthly cable TV bills, and unfair demands like those made by AMC are the reason why cable TV prices are out of control,” commented Mike Hagg, Chief Executive Officer at HTC. “We can’t continue to accept unrealistic and unfair demands of programmers like AMC.”
“We are extremely concerned about how these increases directly impact our customers,” said Matthew Dosch, EVP of Customer Operations and External Affairs at Comporium. “Requiring payment for some customers, who don’t even have the channel in their package is pure greed.”
NCTC members pay companies like AMC Networks, Disney-ESPN, Viacom, Discovery, Turner Networks, and others, programming fees which account for most of what is paid for cable TV service. The network programming contracts allow member companies little to no flexibility in how channels may be packaged and offered to consumers. A common tactic used to generate increased carriage and programming fees is to tie carriage of several unpopular channels to that of a more popular network. This is a tactic AMC is using in this negotiation as it is seeking to force NCTC members to add low-rated networks.
“Not only does AMC’s requirement to force carriage of low-rated channels like BBC World News cause us and our customers to incur costs for channels they don’t want, it also requires excess bandwidth capacity which directly affects our ability to offer our customers faster broadband speeds,” commented ATMC’s Allen Russ.
“The amount of fees demanded by all of the cable TV networks is out of control, and their strict channel carriage requirements don’t give us the ability to sell our customers only the channels they want to pay for,” said TriCounty Telecom General Manager and CEO, Greg Coltrain. “We have to fight for the interests of our customers.”
“We have no problem paying AMC a price that is fair, but an increase that amounts to almost 200 percent is harmful to our customers, and we can’t agree to it,” said HTC’s Hagg. “We remain hopeful that a reasonable offer can be reached before the current contract expires at midnight on December 31st. If a new agreement is not reached, AMC Networks could force us to remove AMC, WE, and their other networks from our lineup.”
Additional information and updates are available at www.TVOnMySide.com, a website that helps educate members about the rise in programming costs and their effects on cable TV rates.