DirecTV’s CBS loss is CBS All Access’ gain

CBS All Access
CBS All Access has seen an "uptick" since CBS channels went dark on AT&T's TV services. (CBS)

AT&T’s current contract dispute with CBS—which has led to channel blackouts on DirecTV, AT&T TV Now and U-verse—is not an ideal situation for anyone involved. But CBS All Access is seeing some upside.

Marc DeBevoise, CEO of CBS Interactive, said that CBS All Access has seen an “uptick” since the blackout began on AT&T’s TV services, according to Deadline.

Last month, CBS-owned television stations in New York, Los Angeles, Chicago, Philadelphia, Dallas, San Francisco, Boston, Atlanta, Tampa, Seattle, Detroit, Minneapolis, Miami, Denver, Sacramento, Pittsburgh and Baltimore went dark on DirecTV, DirecTV Now and U-verse. In addition, 117 CBS stations and affiliates went dark on DirecTV Now. Also, CBS Sports Network has been dropped nationally from DirecTV and DirecTV Now, and the Smithsonian Channel has been removed from DirecTV.

In impacted markets, AT&T has been directing subscribers to alternative means for watching CBS including the All Access service, which costs $5.99 per month or $9.99 per month with limited commercials.

RELATED: CBS warns channel blackout on DirecTV, U-verse could ‘last a long time’

During a TCA presentation, DeBevoise joked about his company’s appreciation for the free marketing.

The current dispute is centered on rate increases. AT&T CEO Randall Stephenson said during his company’s earning call on July 24 that AT&T sent to CBS what it thought was a reasonable offer but that it had been “crickets.”

“When you’re as close as we are, we find a little interesting that we’re still sitting here dark and not having interaction with CBS. I’m guessing they’re probably distracted with other negotiations right now, but I don’t know,” Stephenson said according to a Seeking Alpha transcript.

Shortly after the blackout began, CBS issued a statement warning that it could last a “long time” and accusing AT&T of not acting in the interest of its subscribers.

“This is just the latest example in AT&T’s long and clear track record of letting its consumers pay the price for its aggressive tactics to get programmers to accept below market terms,” CBS said in a statement.

AT&T countered with a statement of its own, saying it was “willing to continue to negotiate and also offered to pay CBS an unprecedented rate increase.” The company said that CBS has been boasting about increased revenues while raising retransmission and affiliate fee rates.

“CBS has hit cable and satellite TV providers and local station affiliates with $1.6 billion in fees the past year. These fees are expected to soar nearly 60 percent to $2.5 billion in the next 18 months,” AT&T said.