Contract Dispute Results in Loss of 7 Channels

October 28, 2014

A contract dispute between Dish Network and Turner Broadcasting has led to Dish subscribers in Minnesota and around the country losing the ability to view seven channels through their subscription service. In addition to CNN, Dish customers can no longer view Headline News, Turner Classic Movies, Cartoon Network, CNN en Espanol, Boomerang and truTV, according to reports.

Although customers may think there are regulations mandating that providers furnish channel availability to their paying customers, that is only true for certain local channels and public television services. Customers are thus largely left to the behest of their large provider’s ability to reach settlements with channel suppliers in order to continue accessing desired programming.

This is not the first time a satellite or cable company has lost channels due to a contract dispute. Such blackouts are actually increasing in frequency. Recently, DirecTV customers experienced a three-month loss of The Weather Channel due to another dispute over contract terms before the two sides reached a settlement. Paying customers have little recourse other than to switch providers.

Successful contract negotiations require businesses to be willing to compromise with one another, whether in television programming or a different industry. When a business contract dispute results in customers losing relied-upon services, the businesses stand to lose a portion of their customer base, along with the profits those customers bring, as a result. The business that pulls provided services from the other business also stands to potentially lose millions of dollars in profits garnered through the contract as well. It is thus in the best interests of businesses who work together to draft smart and beneficial contracts through which they can work together in order to gain profits for both.S

Source: Federal Communications Commission, “Cable television- where to file complaints regarding cable service,” 2014.

Source: CNET, “Dish loses 7 channels in contract dispute with Turner Broadcasting“, Steven Musil , October 20, 2014

This information is general in nature and should not be construed as tax or legal advice.