AT&T pulls plug on Hallmark channels for U-verse subscribers

AT&T U-verse has pulled the plug on the Hallmark Channel and the Hallmark Movie Channel after negotiations on new carriage fees failed.

The telco disconnected the channels at 12:01 this morning, announcing plans to replace them with a free preview of the family programming from Starz Kids & Family and Turner Classic. And since several of Hallmark's programs are available on other U-verse channels, customers can use the U-verse Search feature, by hitting "Menu" on their U-verse remote and selecting "Live TV" and then "Search."

"We are very disappointed that Hallmark has refused to provide AT&T and its customers with a fair deal--one that is no worse than similarly-sized and smaller providers--and refused to adhere to key obligations under our current deal," the telco said in a release. "We offered to extend the current deal while talks continued, and Hallmark rejected that offer. Hallmark has forced us into a position where we no longer have the rights to carry the Hallmark channels... We don't want customers to lose their programming, but we believe strongly that our customers should not have to pay more than their fair share for Hallmark's channels, which is exactly what Hallmark is demanding."

Hallmark, meanwhile, says it's open to negotiations.

"I was stunned by the apparent disregard for the facts in AT&T's recent statement regarding our negotiations," said Hallmark Channels president and CEO Bill Abbott. "However, if they are really serious, my team and I are ready for truly fair negotiations."

The U-verse/Hallmark battle is the latest in a long list of fee disputes between carriers and content providers. Increasingly, the battles have been fought in front of the public.

Time Warner Cable and Disney, which owns ABC and ESPN, recently tussled over fees--and fees for ESPN3.com, the network's online property that streams live sporting events--in a public brouhaha that included an aggressive ad campaign and tough words between the two. A deal between the two reportedly is close enough to be called "done," but still awaits signatures.

For more:
- see this release
- see this article

Related articles:
Report: Disney, Time Warner Cable reach carriage deal
Carriage deal saves 'Mad Men' on AT&T for season opener
Consumer in the middle: Broadcasters take retrans fight to public

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