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Dish customers lose access to Cox Media-owned local stations

Customers in 10 metropolitan areas lose access to more than a dozen local networks over business dealings.

Customers in 10 metropolitan areas lose access to more than a dozen local networks over business dealings.

(Image: Dish Network Corporation/Graphic: The Desk)

Dish Network has pulled more than a dozen local channels in 10 metropolitan areas, blacking out certain local broadcast networks for millions of satellite television subscribers.

At issue are business dealings between Dish Network and Cox Media Group that allows the distributor to carry local channels operated by the programmer in exchange for a fee.

That business dealing, known in the industry as a re-transmission agreement, usually spans a few years and contains provisions that allow for programmers to demand an increase in fees paid over time. Those fees are then passed along to subscribers in their bills.

In recent years, though, program fees have increased to the point where cable and satellite customers are “cutting the cord” and choosing cheaper streaming alternatives like Netflix and Amazon Prime. In turn, distributors have started to take a harder stance with programmers — which have led to sometimes-weeks long disputes that result in paying customers having no access to promised channels.

Dish Network has become particularly aggressive in its business dealings with programmers, opting to drop unpopular channels to keep prices low. In recent years, the company has let deals with AT&T WarnerMedia for HBO and Sinclair Broadcasting Group for regional sports channels lapse.

But this latest dispute is unusual for two reasons: It involves private equity firm Apollo Global Management and a rare restraining order that kept the channels on Dish Network’s systems long after its re-transmission contract ended.

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Earlier this year, Dish Network took Apollo to court after the latter pulled 10 different stations in other markets off the satellite service. Dish Network argued the firm improperly dissolved its re-transmission agreement with those stations when it acquired Cox Media Group and its 14 broadcast stations last year.

A federal judge issued a restraining order that allowed Dish Network to restore the 10 stations. That restraining order ended on July 20, and while the original 10 stations are still on the satellite service, Apollo has chosen to pull the 14 stations operated by its Cox Media subsidiary off the bird instead.

In dueling press releases, Dish Network and Cox Media Group blamed the other party for the situation. Both said they offered compromises that the other company didn’t accept.

For its part, Dish Network said it offered Apollo an increase in re-transmission payments for the rights to continue carrying the stations and promised to reimburse the company for additional payments if Dish Network lost the federal case.

Through Cox Media Group, Apollo said it offered Dish Network an extension to continue carrying the stations, but Dish Network had yet to agree to those terms. It cited comments from the federal judge in Dish Network’s lawsuit that said Cox Media Group “cannot prevent Dish from retransmtting the stations — they go dark only if Dish chooses.”

Both sides acknowledged the need for local news content during the ongoing COVID-19 global health pandemic. But both sides also blamed the other for holding up a deal because of financial interests.

“Dish’s endless gamesmanship with [Apollo] must end,” Paul Curren, a lead executive with Cox Media Group, said in a statement “Instead, Dish has now removed important news coverage and entertainment content from [Cox Media Group] communities… .”

Dish Network said it had worked with nearly 50 other local station owners to “set aside contractual disputes and accept comparable offers to keep local station on the air, given the current pandemic situation and the resulting harm blackouts would cause customers.” It urged Apollo to do the same here.

As of Thursday morning, neither side had reach an agreement, permanent or otherwise, to restore the channels.