Fox-Cablevision talks to resume today

As talks between Cablevision and News Corp. are set to resume in New York this morning, there was little indication Sunday that the stalemate, now entering its third day, is nearing a resolution.

News Corp. pulled WNYW/5 and My 9 from Cablevision at 12:01 a.m. Saturday and the stations remained dark, blacking out Sunday's 1 p.m. Giants-Lions football game on Ch. 5. During the CBS telecast of the 4 p.m. Jets-Broncos game, a Fox commercial suggested that a blackout of the World Series was now a foregone conclusion. It told viewers a number of hit shows, including "Glee," and "House," along with the Series, are now "gone" and to call a number to learn about alternate carriers. The World Series begins Oct. 27.

Just before 4 p.m., Fox issued the first confirmation that the talks had ended without agreement: "The parties had several discussions again today but no material progress was made and we continue to remain far apart. However, both sides agreed to continue talking tomorrow."

Later, Cablevision released a statement saying, "The longer this shameful News Corp. blackout of the NFL and Major League Baseball continues, the more obvious it becomes to everyone, including political leaders of both parties, that binding arbitration is the fastest and fairest way to return Fox programming to Cablevision customers."

Cablevision, which owns Newsday, has made repeated calls for arbitration since late last week, all rebuffed by Fox.

Uncharted territory

This is the longest station blackout stemming from disputes over retransmission fees in the nation's largest market. As such, both companies have entered uncharted territory. Risks include potential customer dissatisfaction with Cablevision and diminished ratings for some of Fox's marquee entertainment shows, including "House," the Fox network's top-rated drama, which is on Monday night's schedule. It has already experienced a ratings slump this season.

"I think it would hurt the local Fox ratings in New York significantly since their footprint of nearly 3 million homes are there," said Brad Adgate, chief of research for the New York-based ad firm Horizon Media.

A handful of blackouts in smaller markets have lasted longer than three days - in the longest, in 2005, the broadcaster Nexstar had three local broadcast affiliates in Missouri and Texas blacked out on Cable One for nearly a year.

Washington involvement

Political pressure also mounted over the weekend. Sen. John Kerry (D-Mass.) and Kevin Law, president of the Long Island Association, the Island's largest business group, separately called for binding arbitration - as did Rep. Steve Israel (D-Huntington) and Rep. Peter King (R-Seaford) last week.

On Saturday, Kerry, chairman of the Commerce subcommittee on communications, announced he plans to introduce legislation that would "stave off" termination of carrying of signals when corporate agreements expire.

In a phone interview Sunday, Israel said, "I've been on the phone with the FCC over the weekend and they continue to say that they want binding arbitration but that one party is refusing. That tells me that if the FCC can't enforce arbitration, then Congress needs to pass legislation giving them the authority to do so."

In recent years, major broadcasters have been seeking fees from cable companies for use of their TV station signals, but Fox has been especially aggressive. "Fox is laser-focused on capturing significant retrans dollars and we see no reason why they would give in," Rich Greenfield, an analyst at BTIG LLC, said in an October report.

In negotiations with Time Warner last year, News Corp. initially demanded $1 per subscriber, or about 75 cents more than what most cable systems were paying for TV stations. Time Warner initially wanted to pay 20 cents and, according to a report prepared by analyst SNL Kagan of Charlottesville, Va., both companies settled at 50 cents, a figure the report expects to rise to 75 cents. According to sources, Time Warner secured a most-favored-nations clause in its deal with Fox, which means that if Cablevision secures a lower rate, Time Warner would be entitled to the same rate.

Sunday afternoon, Fox briefly blocked subscribers of Cablevision's Optimum Online from watching Fox programs on Hulu.com and Fox.com, before reversing itself a short time later.

As the impasse continues, the discontentment of sports fans over the blackout of weekend games appears likely to spread to entertainment fans.

At Changing Times, a Farmingdale sports bar, George Lee, 32, of Huntington, said the blackout is devastating to his mother, who won't be able to watch the exploits of Dr. Gregory House Monday night on her beloved medical drama.

"My mother's elderly and she can't go out," Lee said. "My mother looks forward to 'House' on Mondays. Now she can't watch it."