AMC Networks and a coalition of independent cable operators are going down to the wire in negotiations on a new carriage agreement covering about 4 million subscribers, most of them in small and rural markets.
AMC Networks execs and reps for the National Cable Television Cooperative remained in talks Thursday in an effort to hammer out a successor agreement to a deal that expires at midnight Jan. 1. The Lenexa, Kan.-based NCTC in total represents about 850 small cable operators covering about 12 million subscribers, although only a portion of NCTC member companies are involved in the AMC Networks talks.
Tension in the negotiations has been building for some time, with both sides warning viewers for weeks that a blackout threat is looming. AMC is on a mission to secure rate increases for its mothership channel as well as SundanceTV, IFC and We TV. (AMC Networks also controls BBC America but that channel is not part of the NCTC talks.)
AMC is looking to its next round of carriage negotiations with MVPDs to secure meaningful gains for the flagship outlet that has been fortified by one of TV’s biggest hits in recent years, “The Walking Dead.” At present AMC is believed to command far lower per-subscriber fees than competitors such as USA Network, TNT and FX.
In addition to higher fees for AMC, the company is looking for wider distribution of its other channels. Many of the smaller operators have balked at these points at a time when cord-cutting is accelerating and operators are looking to slim down bundles or emphasize broadband service over pricier video packages.
AMC in a statement said it still hoped to reach a deal with NCTC members. “The Walking Dead” is a big bargaining chip, but the immediate leverage is dampened by the fact that the show does not return with new episodes until Feb. 14.
“We have extraordinarily high regard for the NCTC and for its members. We have long supported smaller cable operators, and the particular challenges and considerations that they face in the service of their markets. We will continue to endeavor to do everything we can to make them successful,” AMC Networks said.
One NCTC member already went public with its promise to drop AMC as of Friday. Anchorage-based General Communication Inc., Alaska’s largest cable operator, blamed AMC’s demand for “massive fee increases.”
“We know Alaska ‘Walking Dead’ fans will be disappointed that AMC’s sky-high rates prevent GCI from carrying the show on our traditional TV lineup,” said Bob Ormberg, GCI’s VP of content and product management. It’s telling regarding GCI’s focus on broadband that the company directed viewers to find “Walking Dead” on Netflix (albeit with new episodes delayed by many months) or Vudu, Walmart’s online content distribution platform.
“The good news is that our customers have more viewing choices than ever before and GCI has made sure that fans can watch ‘The Walking Dead’ by other methods with GCI so they won’t miss an episode when season 6 resumes in February,” Ormberg said.