Analysis: Cablevision/ABC Spat Spills Over To Companies News Organizations

WABC, Cablevision-owned Newsday report on retransmission impasse
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The retransmission battle between WABC and Cablevision days before ABC is set to broadcast The 82nd Annual Academy Awards, has spilled over to the news arms of the companies with Cablevision-owned Newsday and WABC/Channel 7 reporting on the impasse.

While media ethicists concede that the story certainly passes the newsworthy test, it has been covered widely in the consumer and trade press, they warn that having a news organization wade in on a corporate dispute could also backfire.

"I'm not sure either party is playing fair in this. But I thought the [WABC] piece crossed the line," said Bob Papper, chair of journalism department at Hofstra University.

The segment, reported by correspondent NJ Burkett, first ran during the 11 p.m. newscast on March 1. It was re-aired during the March 2 noon news and is available on the station's web site with a link to the micro-site.

"After two years of talks, Ch. 7 has been unable to reach an agreement with Cablevision," said Burkett during the piece. "And without one, the highest rated television station in America has threatened to pull the plug on Cablevision."

A March 2 Newsday article ran in the back pages of the business section and is also featured on newspaper's web site.

On March 1, WABC also began running a promo alerting viewers to the stalemate with Cablevision and warning that they may lose ABC programs including The Oprah Winfrey Show, Good Morning America and Grey's Anatomy. The 3-minute WABC segment included a clip from the spot and also listed several shows that viewers would miss.

"It's a very difficult situation," added Papper. "Is it a legitimate news story? Of course it is. But when they started to give a laundry list of ABC's most popular shows, they crossed a line from news to promotion. I was uncomfortable with that. I was uncomfortable that there was painfully little on the [Cablevision] side."

WABC has threatened to remove the station from Cablevision systems in New York if an agreement is not reached by midnight on March 6. That would leave viewers in the nation's No. 1 market without ABC's flagship O&O right before the Oscars.

Anchors introducing the WABC segment played up the Oscar angle. Both the Newsday story and the WABC segment included statements from each side. The WABC segment also included an on-camera interview with Rebecca Campbell, WABC's president and general manager.

Julie Hoover, a WABC spokeswoman, said that the station assigned a reporter to the story on Monday night. The reporter immediately reached out to Campbell and Cablevision executives who declined a request for an on-camera interview.

"Rebecca was asked to confirm or clarify certain things that she said," said Hoover. "But she made no effort to control the story."

Sources at Newsday say that there was no pressure to do a story about the impasse with WABC. News12 -- the Cablevision-owned local news networks covering Westchester, Long Island and part of New Jersey -- was also set to air a piece about the battle on March 2.

Broadcasters are increasingly looking for retransmission dollars from cable providers who pay per-subscriber fees for cable channels but not for broadcast networks, which in the case of the big four (ABC, CBS, NBC and Fox) draw larger average audiences than cable networks.

Disney CEO Bob Iger said during the company's Feb. 9 earnings call that "it would be appropriate" for ABC to pursue retransmission cash from service providers.

Leslie Moonves, president and CEO of CBS Corporation, has also signaled a grab for retransmission dollars.

"Network programming is at the top," he said during the Morgan Stanley Technology, Media & Telecom Conference in San Francisco on March 1. "If we're spending millions of dollars on NFL football or CSI, we should get paid as much as a cable network showing repeats."

The rancor has increased as broadcasters have seen their business imperiled by a recession battered advertising market. Time Warner and News Corp., which owns Fox, waged their own public battle in late December when News Corp. vowed to remove Fox stations from Time Warner on News Year's Eve, right before Fox's coverage of the college football bowl extravaganza and in the midst of the NFL playoffs.

And Cablevision is no stranger to public squabbles. The Long Island-based cable provider recently resolved a carriage-fee dispute with Scripps Networks, which owns HGTV and Food Network, which deprived Cablevision customers in New York, New Jersey and Connecticut of those channels for three weeks.

Cablevision argues that as a recipient of cable operator cash for its cadre of successful cable networks including ESPN -- which commands hefty sub fees of over $4 per subscriber -- Disney already gets plenty of cash for its programming.

But negotiating in the media and appealing to the public to pressure their cable operators - as the SaveABC7 web site does - may not be effective. In the end, says Robin Flynn, senior analyst at SNL Kagan, "People are thinking, do we really want to lose these shows? None of them are thinking, what are the economic realties that broadcast networks are facing."

The danger is that viewers could blame WABC for pulling the plug on the Oscars and ABC's other programming, not Cablevision.

"You're coming up on the Oscars. That may seem like great timing," said Papper. "But I think that works against WABC. I understand the desire for leverage. But invariably, the problem is that the station is going to come across badly here. If they pull the plug another time, it would be easier to blame Cablevision. If they pull the plug before a big event with Cablevision saying let's keep it going while we negotiate, it's WABC that comes across as the bad guy."