AT&T (NYSE: T) said it has renewed its carriage deal with Viacom following the expiration of its carriage deal for U-verse on Sept. 30. The move ensures both U-verse and DirecTV customers will still be able to watch Viacom channels like MTV and Comedy Central.
Terms of the agreement were not announced in the carrier's brief statement.
However AT&T is touting the increased scale and leverage wrought by its recent DirecTV purchase: According to a person familiar with the terms of the deal who asked not to be named, Viacom's contract terms for U-verse will ultimately, by the end of the deal, match those of AT&T's DirecTV unit, even though U-verse had only 6 million video customers at the end of the second quarter compared to over 20 million for the satellite operator.
"AT&T and Viacom have signed a long-term multi-platform distribution agreement, continuing their long-standing relationship," AT&T said in a statement about the deal. "In recognition of AT&T's status as the largest pay TV provider in the world, this agreement entitles AT&T's satellite and IPTV platforms to the best deal in the industry for Viacom's leading portfolio of television brands."
Viacom and DirecTV signed a seven-year deal in 2012 after the two sides engaged in a contentious summer negotiation that was punctuated by a blackout. That deal bumped Viacom's yearly compensation by 20 percent, or about $600 million, annually.
Of course, Viacom -- which houses MTV, Comedy Central, Nickelodeon, BET and numerous other major cable networks -- has struggled of late in negotiations with smaller pay-TV operators.
More than 60 small cable systems covering about 2 percent of the U.S. pay-TV market elected not to renew their carriage agreements with Viacom last year.
Viacom still faces the expiration of its carriage deal with Dish Network (NASDAQ: DISH), but otherwise has most of the other major pay-TV services locked up into long-term carriage deals.
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