Sinclair could pull stations

Sinclair could pull stations

	Published : Wed, 28 Feb 2007 23:08 By : Agencies Print this Story

BALTIMORE (AP) - Sinclair Broadcast Group Inc. planned to pull its television stations from Comcast Corp. cable systems at 2 a.m. Thursday, barring a new deal with the nation's largest cable operator to retransmit the stations, a Sinclair official said Wednesday.

The move would leave millions of Comcast customers in markets including Baltimore and Pittsburgh, where Sinclair owns the Fox network affiliates, unable to watch the popular 'American Idol' results show on Thursday unless they hook up an antenna.

'It's important for people to know there's a chance they could wake up (Thursday) morning and the station might not be there anymore,' said Barry Faber, Sinclair's vice president and general counsel.

Hunt Valley-based Sinclair pulled its stations earlier this year from another cable provider, Mediacom Communications Corp., for several weeks during a similar negotiation over are transmission consent' -- the permission granted by broadcasters to cable and satellite providers to carry stations that are available over the public airwaves.

Traditionally, broadcasters have allowed cable companies to retransmit their stations for free, but Sinclair has begun demanding that it get paid. The company argues that its programming is far more popular than the shows on channels that cable companies pay a premium for.

'Our view is that we need to be compensated in connection with retransmission consent,' Faber said.

The company is expecting to receive $48 million in retransmission consent fees in 2007 -- about double what it received last year, Faber said.

Philadelphia-based Comcast has 24.2 million cable customers. About 3 million of those, spread across 23 markets, receive Sinclair stations.

If Sinclair and Comcast do not reach a new retransmission consent agreement or extend their current one, Sinclair could order the cable company to stop carrying 30 of its stations -- more than half the stations the broadcaster owns.

'Our first goal is to protect our customers from being charged extra for free TV,' Comcast spokeswoman Jenni Moyer said. 'We continue to talk with Sinclair and will continue to offer Sinclair's broadcast stations unless they demand that those stations be removed.'

In addition to Pittsburgh and Baltimore, Comcast carries Sinclair stations in Minneapolis; Tampa, Fla.; Richmond, Va.; and Nashville, Tenn.

About 700,000 Mediacom customers went without Sinclair stations for about four weeks before a deal was reached in early February, two days before the Super Bowl. Mediacom officials did not disclose the price but said they began paying to carry Sinclair stations for the first time.

According to analysts, Sinclair has less leverage in its negotiations with Comcast than it did in the Mediacom dispute. A far greater percentage of Sinclair customers than Comcast customers would be affected by Sinclair pulling the stations -- which could jeopardize Sinclair's advertising revenue.

'Comcast has a ton of scale, and they are a tough negotiator,' said John Blackledge, who analyzes Sinclair for J.P. Morgan Chase. 'They definitely have the ability to hold out if they don't like the terms.'

At the same time, Sinclair has the advantage of providing programming that Comcast customers want to see.

'They are not going to have 'American Idol.' They are going to be missing some content that some of (Comcast's) competitors will have in those markets,' Blackledge said.

Earlier this year, Sinclair reached a new retransmission deal with Time Warner Cable Inc. without pulling its stations. Time Warner has about 6 million customers in markets where Sinclair owns stations.

Sinclair already is in preliminary talks with two other cable companies -- Cox Communications Inc. and Charter Communications Inc. -- about new retransmission deals, Faber said. Cox is the nation's third-largest cable provider, and Charter is the fourth largest; together, they have about 10.8 million customers.

'They want to get what they think they deserve,' Blackledge said. 'They have been aggressive, but I don't think there's anything wrong with being aggressive.'