MediaFile

TV Content wars, blackouts could spur M+A

Dish customers: No 'Breaking Bad' for you! (Photo: Reuters)

 

Evercore analyst Bryan Kraft believes the prolonged blackout that has left DirecTV’s 20 million subscribers without MTV, Comedy Central or Nickelodeon for a week, could lead to some industry consolidation.

In a research note out late Wednesday night, the analyst said if content providers Viacom, as well as home of ‘Breaking Bad’,AMC, which was dropped from No. 2  satellite provider Dish Network in July, get the upper hand, it raises the chances of a merger between satellite companies and cable providers.

If DirecTV and Dish comes out the winners, he said, it encourages cable TV networks to merge, but only when their valuations fall. DirecTV has pushed backed against what it claims are exorbitant increases in Viacom’s programming fees that it says it does not want to pass on to customers.

And DirecTV viewers aren’t the only ones suffering. Kraft estimates that the dispute is making Viacom lose about $14 million a week. Meanwhile DirecTV would need to lose 1.15 million subscribers before its cash flow was impacted. Kraft said that if DirecTV expects to lose more than 1.15 million subscribers, it should pay up the $3 per subscriber fee Viacom is likely seeking.

As one of the most high profile blackouts stretches into its second week, time will tell whether the spat will be the one that changes the pay TV landscape for good or whether it just causes viewers to change the channel.

Viacom drags online video into DirecTV dispute

Stephen Colbert looks nonplussed. (Photo: Reuters)

Just as we were getting prepared for the latest round in the increasingly vicious battles between programmers and TV distributors, the Viacom fight with DirecTV took a new twist.

For the first time we can recall, the fight was extended to Viacom’s freely available shows online. The owner of MTV, Comedy Central, BET and many more decided that in order to properly enforce its blackout of TV shows from DirecTV it would “slim down” its Web offerings by blocking the latest episodes of Comedy Central’s “The Daily Show” and “The Colbert Report.” These shows are usually available for free soon after airing on TV.

One issue might be that, to date, Viacom shows are ‘free’ in the true sense in that they do not require the online viewer to have a cable or satellite subscription — something that News Corp’s Fox has done. The idea is that you can watch these shows at no extra charge if you can “authenticate” yourself as a paying cable subscriber.

What’s Charlie Ergen’s strategy this week?

Satellite TV billionaire Charlie Ergen isn’t a regular on Dish Network’s analyst conference calls these days especially

Charlie Ergen, Reuters archive photo from 1999

since he stepped down in May as chief executive (which he still chairs). But when he makes an appearance, nearly as rare these days as one of those biennial dividends it pays, it’s worth a listen.

After losing more subscribers than expected in the third quarter Dish executives pointed to larger rival DirecTV’s hugely successful NFL football Sunday Ticket giveaway as the primary source of competition.

Netflix soars, investors cheer…then Web service crashes.

ReedHastings

It’s been a heady few months for Netflix, the DVD by-mail company fast becoming a online video streaming service. Yesterday, its third quarter numbers again beat Wall Street expectations as it revealed it is now the third largest video subscription service behind Comcast and DirecTV with nearly 17 million subscribers. Wall Street analysts at UBS and Oppenheimer, already in love with the company, upgraded it on Thursday morning helping to push shares to a new record high of $174.40 before closing at $172.69. To think you could have bought the stock for $47.56 exactly one year ago.

Analysts were m0st excited about the potential for Netflix’s video streaming-only service, which will do away with the heavy expense of delivering DVDs to subscribers homes across the country. In the words of Netflix Chief Executive Reed Hastings (here pictured):

“Three years ago, we were a DVD-by-mail company that offered some streaming.” “We are now a streaming company, which also offers DVD-by-mail.”

Charlie Ergen: Satellite cowboy, TV viewer, pitchman

Charlie Ergen is best known in media business circles as the straight talking homely founder of satellite TV provider Dish Network Corp. He’s often been disarmingly honest on quarterly conference calls with Wall Street analysts by admitting that he had personally taken his eye off the ball when the company was losing customers a few years ago or putting his annual family vacation ahead of being present on the quarterly call.

Well Dish Network’s marketing team is hoping that Ergen’s southern gentleman charm can win over new customers or at least keep old ones in the pay-TV wars versus DirecTV Group and the various US cable operators.

Ergen appears in a new in-house produced campaign below talking about his pride in the company he founded, his “embarrassing” picture from his early days, and its recent success in customer service etc.

Karmazin, Ergen and Malone: paper tigers?

When media moguls duke it out, what’s their battleground? Newspapers, evidently.

For the past week, EchoStar boss Charlie Ergen and Sirius XM radio’s CEO Mel Karmazin have been doing battle on the pages of two venerable dailies, The Wall Street Journal and The New York Times. The Journal had a head start on the story, reporting how Ergen had started buying up Sirius debt in an attempt to force the satellite radio company into a deal. Then, it revealed how Ergen had actually made an offer to buy Sirius, which Karmazin rejected.

While the rest of the media was digesting all this, out came the Times with a story that said Sirius was preparing for a Chapter 11 bankruptcy filing, which could come within days. It had even hired bankruptcy experts, the Times wrote. The Journal quickly swatted that idea down, saying:

Looks like Yahoo’s not buying Tumblr

Gawker/Valleywag created a bit of stir on the blogosphere Monday with its report that Yahoo was in talks to buy blogging startup Tumblr for “low to mid-eight figures,” or as much as $50 million.

From the post:

We hear the talks are serious, led by Tapan Bhat, a fast-rising executive in charge of Yahoo’s homepage and other key properties — but as with any acquisition talks, they could fall apart.

We figured Yahoo’s new CEO Carol Bartz was too busy figuring out where Yahoo should seek growth and how to stem the leaky ship to pursue an acquisition. Sure enough, Silicon Alley Insider knocked down the Valleywag story by getting Tumblr founder David Karp on the record:

DirecTV bats for cricket in the U.S.

Sports fans in the US will now have the chance to cheer fours and sixes as much as home runs.

 

Satellite TV service provider DirecTV Group plans to step off the baseball diamond and onto the pitch by bagging broadcast rights for big-ticket cricket tournaments in 2009.

 

With an Asian Indian population pushing 3 million in the US, DirecTV is assured of a loyal fan following. Indians are crazy about the game, with the country boasting the largest global cricket audience. Cricketers are feted like pop stars and tote multi-million-dollar sponsorship deals.

An unclear future for DISH?

charlieergen1999.jpgWall Street sell-side analysts seemed to be unsurprised by AT&T’s decision to pick DirecTV as its video marketing partner for its version of the ‘triple play’ package, in regions where it hasn’t built out its U-verse digital service.

The final decision had seemed obvious to analysts after DISH said earlier this month that AT&T would extend its five-year relationship by just one month to Jan 31.

But what does it mean for the independent DISH and its maverick founder/CEO Charlie Ergen (pictured), with the No. 2 U.S. satellite TV provider already struggling with customer losses in a tough economy?

TiVo CEO: Subscribers will come

ParrotsA couple of years ago, if you had suggested TiVo and DirecTV would ever kiss and make up — after DirecTV dumped TiVo in favor of DVRs by NDS (then a cousin in the News Corp Family) — you might have said it was as likely as “90210″ coming back to TV.

Well one day after the new “90210” premiered on the WB network, TiVo and DirecTV said they are working on a new HD TV set-top box. The agreement puts TiVo in a position to turn a bigger portion of DirecTV’s 16+ million customers into TiVo subscribers, in a deal that TiVo says will reap more in fees than previous agreements.

Reuters spoke to TiVo CEO Tom Rogers about the deal.

Reuters: This is kind of like getting back together with your first love.
Rogers: I’ve been saying for a long time that with DirecTV’s ownership by Liberty Media, it created a new atmosphere and a new environment. I think the management of DirecTV has always been supportive of TiVo and believes that we can put together a very exciting offering.