AMC Networks at odds with Altice over Cablevision carriage

The Walking Dead
AMC Networks' negotiating tactics fall well short of bashing in heads with a barbed wire bat, but pay-TV operators like Cablevision still don't appreciate them. Image: AMC Networks

The Dolan family-owned AMC Networks is currently embroiled in a bitter carriage dispute with Altice-owned Cablevision, mere months after the Dolans sold Cablevision for $17.7 billion to the Netherlands-based telecom giant.

According to the New York Post, AMC Networks has been running a crawl on its networks for Cablevision’s Optimum service customers, warning them the networks will disappear if AMC is unable to reach a new agreement with Cablevision.

“We have a long history of working with and creating value for Cablevision and Suddenlink and their customers, who enjoy our popular shows including AMC’s ‘The Walking Dead,’ the #1 show on television for the past five years. We are seeking nothing more than fair value for our programming, consistent with all of our recent distribution agreements,” AMC reps told the publication.

AMC’s current deal with Cablevision expires on Dec. 31.

Cablevision, under Altice, is looking to reduce programming costs as a way of achieving cost synergies pledged prior to the close of the acquisition. According to the report, programming costs are rising 10 percent, but Altice is only willing to pass on about 3.4 percent to customers.

In light of its push to scale back costs, Altice is firing back at AMC’s tactics to gain leverage in the negotiations, telling the Post that the network’s behavior is “disappointing, but not surprising given it has a history of using viewers as pawns to extract significantly higher fees from distributors.”

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“We are working hard on behalf of our customers to negotiate an agreement with AMC Networks that is reasonable and reflects the best interests of all our customers. AMC Networks is using misleading scare tactics, threatening to black out its programming unless we agree to their excessive demands and pay significantly more to carry the same AMC channels our customers currently receive, all of which have declining viewership on our systems," Altice added in a statement to FierceBroadcasting.

The heated debate with Cablevision is not the first time in recent history that AMC’s bargaining practices have bristled pay-TV operators. In January, AMC reached a new licensing deal with National Cable Television Cooperative, but many members of the programming buying cooperative still opted to drop AMC because of the increase in programming costs.

NCTC CEO Rich Fickle described the proceedings “the most challenging deal I’ve seen in four years,” according to Deadline.

Despite its efforts to secure lucrative deals with operators, AMC has been struggling to produce sustained growth.

In the most recent quarter, AMC Networks’ profit dropped about 11 percent as operating income for its cable networks declined 26.5 percent and net income fell to $65 million.

Distribution revenue jumped 8 percent to $336 million due to an increase in licensing revenues and affiliate fees, but networks' advertising revenues ultimately decreased 9.9 percent to $189 million because of lower ratings.