DirecTV on Tuesday responded to concerns expressed by a group of U.S. Jewish community leaders about the pay TV provider dropping conservative channel Newsmax, trying to reassure them that the ongoing dispute is all about economics and not ideology.
DirecTV and Newsmax have been publicly butting heads over a carriage dispute that saw Newsmax leave DirecTV, U-Verse and DirecTV Stream systems on January 24 after the two were unable to reach new terms before an existing contract expired.
Amid the dispute Newsmax and some Republican lawmakers have accused DirecTV of trying to stifle conservative viewpoints by not carrying the channel, in some cases also pointing to the exit of One America News Network from the pay TV provider last year (a carriage decision recently upheld by a California judge).
DirecTV continues to maintain that Newsmax for the first time wanted “tens of millions in dollars in licensing fees” in exchange for carraige, as it looks to shift its own business model. DirecTV, which hasn’t paid fees for Newsmax since it started carrying the channel in 2014, sees the fees as unreasonable and would need to pass along costs to customers through price increases. Newsmax, for its part, has rebuffed that claim, saying it is “seeking a very modest fee” of about $1 per cable subscriber per year when it believes its market rate is $5. It said that’s a key reason hundreds of other cable operators renewed with the network last year.
The most recent developments include concerns from Jewish community leaders in the U.S. focused on losing Newsmax, which they see as an “invaluable voice” providing “fair coverage of Jewish issues and Israel.”
In a letter with 23 signatories sent February 7 to the CEOs of DirecTV, AT&T and TPG Capital, the community leaders asked DirecTV to reconsider keeping Newsmax and warned that by removing the channel DirecTV would “lose significant support from the Jewish community.”
“As leaders in our community we represent millions of Jewish Americans. Newsmax has been a crucial way for us to reach our fellow Americans to share our perspectives on anti-Semitism, anti-Zionism, the State of Israel and other matters important to our community,” stated the letter signatories, including former U.S. Senators Joe Lieberman and Norm Coleman. “Fair coverage of issues of concern, including coverage of the State of Israel, has been difficult to find in major media. In fact, many in the media have turned a blind eye to the sharp and dangerous rise of anti-Semitism in America.”
Given those changes, Bryan Leib, the spokesperson for the group of signatories and a community leader who previously headed Iranian-Americans for Liberty, said that Newsmax is needed now more than ever.
“We are deeply disappointed and troubled that the nation’s 4th highest-rated cable news network, and a stalwart ally of Israel, covering the issues of concern to American Jews, was removed by AT&T,” said Leib in a statement. AT&T spun out DirecTV in August 2020, and while it operates separately from the telecom, AT&T is still majority owner controlling 70% of the company, with financial firm TPG holding 30% of DirecTV.
In a Tuesday response to the letter from community leaders, DirecTV General Counsel Michael Hartman said it takes “very seriously the concerns” raised and would be willing to meet in person to discuss, but reiterated its stance that Newsmax claims of DirecTV bias against conservative voices is untrue, and that the dispute comes down to business. He emphasized that DirecTV works to offer a range of viewpoints on its systems, and also took aim at Newsmax, asserting it’s using its own platform to spread inaccurate information about the situation.
“Put simply, this is a typical business dispute that has nothing to do with ideology, politics or censorship – despite unfounded accusations to the contrary by Newsmax, its CEO, its commentators and others,” wrote Hartman to the Jewish leaders, including Rabbi Arthur Schneier of Park East Synagogue and Abraham Foxman, former national director of the Anti-Defamation League.
The letter explained that the cost of a licensing fee, which DirecTV did not agree to, is something the satellite TV provider would have to pass along to all of its customers.
“No other major pay TV operator in the market currently pays per subscriber fees to carry the channel,” DirecTV noted of Newsmax. The dispute also comes as DirecTV is facing industry challenges of pay TV declines and rising programming costs alongside continued cord cutting. In an effort to combat rising operational costs, the company last month slashed roughly 10% of its management workforce.
In another move to show its commitment to various viewpoints, shortly after dropping Newsmax, DirecTV added conservative channel The First. It marks the first MVPD deal for The First, which was previously a streaming-only channel and offers opinion and commentary from voices such as Bill O’Reilly, Dana Loesch, and others.
DirecTV’s response letter also pointed to its long history of carrying Newsmax, while noting it still a carries predominantly news channels that cover a range of viewpoints including conservative-leaning Fox News and The First, liberal-leaning MSNBC and CNN, and NewsNation which positions itself as moderate – while citing Newsmax as a “distant fourth” in terms of popularity for news networks when it was distributed by DirecTV.
“For both sides, the ongoing dispute comes down to economics. We want to provide our customers with the robust level of programming that they expect without unnecessarily increasing their financial burden,” DirecTV said.
And the letter argues that Newsmax is the one working to limit access to its own channel as it aims to change the business model, seeking to charge fees to distributors and become only available to pay TV subscribers. Changing to that model would mean Newsmax would no longer be accessible by the more than 55 million households that don’t have a pay TV subscription, but who can watch it today for free through a variety of other platforms, DirecTV asserted.
“Clearly in this instance Newsmax favors profits over access,” DirecTV said in its response.
As the dispute drags on, DirecTV also accused Newsmax of now using its own news and editorial platform to sway the conversation and publish inaccurate information on the contract dispute to further its own business aims.
“Newsmax is using its own newsroom platforms to obscure facts with inaccurate and misleading information – including dozens of daily blog posts, a steady stream of social from corporate or employee handles and 2+ hours of on-air programming daily – all in pursuit of its own business interests,” said a DirecTV spokesperson in a statement shared with Fierce Video.
In the response letter to the community leaders DirecTV’s Hartman shared similar concerns over Newsmax’s coverage of the dispute.
“In our view these efforts are obscuring facts in pursuit of Newsmax’s own commercial interests, not elucidating the news,” wrote DirecTV’s general counsel.
Fierce has reached out to Newsmax for comment.
The issue also came up this week at the hearing Senate Commerce nomination hearing of FCC nominee Gigi Sohn, reported by CableFax, where she expressed a desire for the commission to examine DirecTV’s decision to drop Newsmax and One America News. The report noted Sohn didn’t know the facts of the situation but had concerns competition issues could be at play for independent programmers, giving the FCC an opportunity to look at practices around bundling.
And once again, DirecTV said it’s still willing to negotiate in good faith with Newsmax to restore the channel, noting carriage disputes, while not uncommon, are frustrating for all but typically temporary.
“After networks withdraw their consent, we continue to negotiate, and the parties ultimately reach agreement," DirecTV stated. “We hope this matter can be resolved in the same way.”