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Fox-Time Warner dispute could keep UF-Cincinnati game off area cable TV

LOS ANGELES — Bart Simpson and the Sugar Bowl football game between the University of Florida and Cincinnati could disappear from the TVs of Time Warner and Bright House subscribers in a bitter dispute over fees the Fox television network is demanding.

As a midnight deadline approaches today, Time Warner Cable offered an olive branch that could leave the Fox network and some of its cable TV channels on the lineup for millions of subscribers — for now. But an executive at Fox owner News Corp. indicated a signal interruption was likely.

Nearly 1 million homes in the Tampa Bay area subscribe to Bright House, which carries WTVT-Ch. 13 as well as other Fox channels, including Speed, FX and Fox Sports Networks. Time Warner oversees content for Bright House. (Fox News and Fox Business Network have separate agreements.)

In the past, the Fox network was offered free, and cable companies essentially paid more for FX and other cable channels News Corp. owns. This time, News Corp. is demanding $1 per subscriber every month for the network itself.

Fox, hurt by reductions in advertising revenue and increases in programming costs, argues that Time Warner is making money off its programming, so it should get a cut of revenue. Time Warner says the demanded fees are excessive.

Time Warner Cable CEO Glenn Britt said Wednesday the cable TV operator will agree to binding arbitration and any interim steps necessary to keep Fox channels on while talks continue.

"Consumers should not be held hostage during these negotiations. That's just wrong," Britt said in an interview Wednesday.

But in a note to employees Wednesday, News Corp. chief operating officer Chase Carey said temporarily extending the current terms past tonight would "simply extend the period of time that Time Warner profits from our marquee programming without fairly compensating Fox for it."

He also rejected arbitration as a possibility in a letter to Sen. John Kerry, D-Mass., who had pleaded for both sides to agree to uninterrupted television for football fans "through the college bowl season."

In Florida, two television viewers filed a lawsuit Wednesday against News Corp., seeking an injunction to ensure that Friday's Fox broadcast of the Florida-Cincinnati Sugar Bowl contest would remain on Bright House's cable system. Circuit Judge Maura Smith in Orlando did not immediately rule.

The last time a major broadcaster went dark on a cable TV operator was when the Walt Disney Co. asked Time Warner to pull signals from its 10 ABC stations in May 2000 in a fee dispute. Time Warner took the signal off for a day before succumbing to pressure and agreeing to an extension. A deal was made later that month.

"Normally, they work things out," said Derek Baine, a senior analyst at SNL Kagan in Monterey, Calif. "But it's very hostile and it's very ugly."

Thomas Eagan, an analyst at Collins Stewart LLC, said Time Warner Cable would take the more direct hit from a standoff because subscribers could defect to a competitor, such as DirecTV or Verizon's FiOS.

Information from Times files was used in this report.

Fox-Time Warner dispute could keep UF-Cincinnati game off area cable TV 12/30/09 [Last modified: Wednesday, December 30, 2009 9:36pm]
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