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Viacom, DirecTV reach deal, end 10-day blackout

NEW YORK — Viacom will get more than $600 million a year from DirecTV in programming fees under their new seven-year agreement, up at least 20 percent from the previous terms, Bloomberg News reported.

Viacom, owner of the MTV, Comedy Central and Nickelodeon networks, announced a new agreement with DirecTV on Friday morning, ending a 10-day blackout on the satellite-TV service. Bloomberg News said a person familiar with the payments asked not to be named because the information isn't public.

Before the accord was reached, DirecTV said that Viacom was demanding a 30 percent increase, amounting to more than $1 billion in additional costs over the contract.

"They're both winners here," said Amy Yong, an analyst at Macquarie Capital USA in New York. "DirecTV got a deal that was less that Viacom wanted, so on the margin, that's a win for DirecTV. But it's also a win for Viacom because they get more money."

The deal restores Jersey Shore, Dora the Explorer and other shows to DirecTV's 20 million U.S. viewers, with all of Viacom's 17 standard-definition and nine high-definition networks returning to DirecTV. The agreement doesn't require DirecTV to carry the movie channel Epix — a source of contention during negotiations. DirecTV had said Viacom was insisting the satellite provider pay more than $500 million for Epix, which Viacom denied.

DirecTV also secured out-of-home live-streaming rights for all 17 of Viacom's channels as part of the deal, said Derek Chang, DirecTV's executive vice president of content strategy and development. That means customers will be able to watch live Viacom programming on their phones, tablets and computers.

It's the first time Viacom has given a pay-TV provider live rights to their programming, Chang said. There's no time frame yet for when the service will be available, he said.

The parties had been negotiating for several months and extended their seven-year agreement past the original June 30 expiration while talks continued. Viacom's channels went dark for DirecTV subscribers just before midnight on July 10. The satellite provider cited shrinking Viacom ratings during the dispute. Viacom has said its programs amount to 20 percent of DirecTV's audience.

Viacom, DirecTV reach deal, end 10-day blackout 07/20/12 [Last modified: Friday, July 20, 2012 9:54pm]
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