News 4 & Time Warner, Roasting on an Open Fire |
by Jay Joseph |
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In case you don’t follow the news, or you’ve been living under a rock for the last few months, let me bring you up to speed on some crucial current events. Bush will probably go down as one of the worst presidents in history; the candidates who want to replace him never talk about politics; the economy is on red alert; and finally, Time Warner Cable’s contract to carry the signals of WIVB and WNLO Buffalo has officially expired. All of the sudden that rock doesn’t sound so bad.
Now some people would say that last bit of news shouldn’t fall under “crucial current events” or they already know about all this, but I beg to differ. Just this past weekend, hundreds upon thousands of Time Warner Cable customers stood in line to get a free rabbit ear antenna in order to watch the channels they no longer get, most of them Bills fans literally scared out of their body paint about not being able to watch the Buffalo-Arizona game. Time Warner tried to make it up to Buffalo customers by giving these away at company locations in Amherst, Orchard Park, West Seneca, and in the city. Hundreds stood in line at all four locations Friday, Saturday, and Sunday, with Time Warner giving away more than 30,000 rabbit ears. But most importantly, this story received top news coverage this past week on Channel 4 News, keeping us connected! It all began at the stroke of midnight on October 2, 2008; Time Warner Cable, right here in the City of Light, had to drop WIVB channel 4 and WNLO CW 23 by federal law. The short-term agreement to carry those cable stations expired that day, with currently no negotiations for a new contract a whole week later. This however, could change any time now, and for everyone’s sake, the sooner the better.
So what does this all mean for you the reader? Well, since no new contract has been reached thus far, Time Warner Cable customers no longer have channel 4 (CBS) or WNLO (CW). That means, without a local cable antenna, you will miss Buffalo Bills games, The Price is Right, Oprah, and News 4 Buffalo, “our region’s most watched television station.” Don’t forget about The AFC divisional playoff games, if an agreement isn’t made by January 10 and 11 of 2009, as well as the AFC championship game on January 18, 2009.
LIN TV, which is the parent company of both channel networks, claims it has attempted to negotiate a new long-term agreement to keep the stations on, however, Time Warner has apparently not responded to their proposals. Time Warner insists they have been actively negotiating with LIN TV, and that the management teams at WIVB and WNLO are using their stations to spread misleading information. Sounds to me like typical dirty politics. Each side has a different story and only they know the truth.
In an open letter to customers on Timewarnercable.com, Terence Rafferty, president of the Western New York division, states that Time Warner has “no intention of dropping WIVB and WNLO” and that “WIVB and WNLO are seeking millions of dollars for programming that is available for free with an antenna.” (Which is true.) Finally, he wrote, “Any decision to pull WIVB and WNLO from our lineup will be made by LIN TV and WIVB and WNLO, not Time Warner Cable.”
If you head on over to WNLO.com, you’ll get a completely different tale. According to a statement from Christopher A. Musial, the president and general manager of WIVB-TV and WNLO-TV, “The fair compensation we are asking for as part of our contract negotiation with Time Warner amounts to less than a penny a day per station/per subscriber. Cable companies often say that local broadcasters have ‘unreasonable demands’ when it comes to carriage agreements. We do not believe that a penny a day per station/per subscriber is an unreasonable demand for our award-winning news, sports and entertainment programming. It is actually much less than what cable companies compensate many of its cable networks, none of which have the viewing of your local CBS and CW stations.” Mr. Musial even went to extraordinary lengths by appearing on News 4 to explain LIN TV’s side of the story.
You may be asking yourself, why can’t Buffalo get a decent cable provider? Both these statements contradict each other, so we don’t really know who the bad guy is here. Time Warner makes it sound like LIN TV is just trying to make more money off you the customer, but would that really shock anyone? LIN wants to be compensated by Time Warner for allowing it to carry stations that are available over the air for free and now they seem to be throwing a hissy fit because things aren’t going their way. There’s a toll free number for Channel 4 fans to call about their cable and television choices, and the WNLO website features numerous ads for companies such as DirecTV, Verizon, DISH Network, and Comcast, the last of which is this writer’s favorite pick (based only on its resemblance to Sega Dreamcast.) Is WNLO persuading its viewers and Time Warner customers to switch to other companies? Is News 4 scared of losing their crown?
This isn’t the first time Time Warner Cable hit sports fans where it hurts. On July 31, 2006, Time Warner Cable and Comcast purchased most all of Adelphia’s assets for over $15 billion. In case you don’t remember Adelphia, it was once the cable monopoly here in Buffalo, until its already-rich owners wanted to be even richer...illegally. A story which has become all too familiar in this day and age.
Time Warner Cable took on millions of Adelphia’s subscribers, many of whom were here in Buffalo. Then, in September 2006, Time Warner removed the NFL Network from its cable broadcasting systems, leaving many football fans under a blanket during a blackout. The NFL’s 24-hour, nonstop football network was a hugely popular station, and not a lot of sports fans were happy.
Now I’m not a businessman, but in my opinion the best thing for Time Warner and LIN TV to do is stick together like a stamp on a letter. Both companies don’t seem to realize that neither can win this contest. If Time Warner says no to carrying WIVB and WNLO, they will lose thousands of customers. Buffalo is a city of pride and one thing we love are the Bills. If just channel 4 is taken away, sports fans will switch to a different provider before you can say FIOS.
As for LIN TV, they will lose more viewers than they think, possibly knocking the beloved News 4 off the top of the mountain. Many people don’t care about sports, CBS programming, or CW 23, which most cable viewers have never watched once. LIN TV may think most of Time Warner Cable customers will switch just for their two channels, but they’re wrong. They’ve already lost viewers, and saw that Time Warner customers can just hook up an antenna. The bottom line is Time Warner and LIN TV need to agree on something before it’s too late! Both companies are in trouble because both companies will lose in the long run, and this is certainly not the best time to be losing business and money. Of course, this is entirely this writer’s opinion; ultimately it’s up to them to decide what they do, but will that decision be the right one? Only Time Warner will tell.
Jay Joseph
Buffalo
Reader Comments
Donald Snoop 09 Oct 2008, 08:10
I don't know all the issues but it sure sounds like Time Warner may be
right in this situation. I have heard stories of these same things
happening in other parts of the country and it doesn't make sense. The
channels are available free off the air with an antenna as opposed to all
the cable channels that LIN TV is referring to. It sounds like mostly greed
on the part of the broadcasters bolstered by rules that were put into place
by Congress.
Ricardo Anselmo 09 Oct 2008, 11:28
The whole situation really has been caused by LIN TV by pulling their
signal from Time Warner. Adelphia left Time Warner with a mess and at least
Time Warner made an effort to upgrade their system. I rarely watch WIVB or
WNLO so it is no big loss. Keep the federal government out of this and we will be a lot better.
Marty 09 Oct 2008, 13:00
I don't believe you could be more wrong, just because a station is "free"
over the air does not give time warner the right to show it without
compensating them. Remember, it is the number one watched station on all of
cable. That says something to me. Also remember that with the advent of
timewarners "dvr" box most viewers skip commercials, which is where Lin
television used to obtain all its revenue, which is advertisers reduced
knowing that as many people aren't watching their commercials. and lastly,
most cable stations that get paid by timewarner also receive money through
advertisers.
Abe Louis 09 Oct 2008, 13:13
Don't blame T-W or the local WIVB (WNLO) staffers. Indeed LIN, for whom
Chris Musial is simply a local puppet, is the greedy party here and
shooting themselves in the foot. Channel 4 is already losing advertising
revenue in spades because of the loss of up to 70% of its viewers and, as
the top-rated station, should not need revenue from its principal
transmission vehicle [LIN should actually be paying T-W for expanding the
ch 4 and ch 23 coverage areas].
Lee 09 Oct 2008, 13:31
I didn't even know what shows are on WIVB any more, I am not going to give
up my TWC/RoadRunner package for a station I never watch, and I can guess
that more people think like that than LIN would like to admit.
Marty 09 Oct 2008, 13:36
When it's pricipal transmission vehicle is basically stealing lin
broadcasting and using it for free. If Lin is the top rated station, they
do not need t-w, t-w needs them. t-w customers will jump ship quicker then
you can say fios once they know whether or not this is permanent.
Donald Snoop 09 Oct 2008, 13:52
Marty's comments are interesting, but I don't think he realizes that the
cable companies have been paying copyright fees for the right to
rebroadcast the of-air channels and charge a fee to their customners to
view them. The comment about the cable channels that are only available via
satellite to cable tv companies charge a per subscriber fee to be carried
is accurate and most of them do sell advertising, but you may not know that
most of them also offer the local cable tv company the opportunity to place
their own local ads which offset the costs. If the local broadcasters would
be willing to share their advertising inventory and revenue, it might make
more sense.
Tom 09 Oct 2008, 18:09
Very interesting story. Lin tv can't blame Time Warner for its poor
revenue, then couldnt all channels do the same thing?
rose 10 Oct 2008, 00:13
I'm not sure who is right or wrong here, but it seems to me that if that
penny a day per customer thing is true, then I think Time Warner can
somehow find 30 cents a month out of the $124 per month I pay them. They are compensating people up to $20 or giving away free antennas. So how many months would it take for that 30 cents to pay off that $20 antenna? 66.66 months!! That's over five and half years! It just makes no sense. Especially when you figure in customers that decide to switch. That is even more money lost. The whole thing is pretty ridiculous.
timo 11 Oct 2008, 14:24
One important question: Does Time Warner pay any other local broadcasters
for their feeds?
Joecitizen 13 Oct 2008, 05:49
Channel 2 and 7 will be up to negotiate their contracts in January and are
watching very closely no doubt. This is a question I would like to throw
up for discussion....If I am paying for cable why is it that such a large
amount of time is given to paid advertising aka infomercials...I think that
for every half hour of paid advertising we should get a half hour of
commercial free programming ....how much money do the cable companies need
to make? what do you think?
Abe Louis 13 Oct 2008, 11:13
Good question, Timo, To the best of my knowledge, payment to OTA broadcasters by cable or DSL carriers is pretty much unprecedented. As I mentioned above, any payments should actually go in the opposite direction simply because these carriers expand the potential audience. If that's not the case (and T-W is deemed the bad guy) then just wait for the 5 other WNY OTAs not to mention at least 3 Ontario TV stations to go after their "lousy penny" /sub/day.
Gina
14 Oct 2008, 13:47
I just want to know, if a new contract is in process? Otherwise will other
stations pick up these shows that are entertainment for us?
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