The fear for a lot of investors is that Madison Square Garden Chairman Jim Dolan has too many agendas that will lead him to avoid compromising with Time Warner Cable in their dispute over payments for channels including regional sports powers MSG and MSG+. Madison Square Garden shares fell 1.4% today — a contrast to the overall market which was up about 1.6% — after Dolan yanked the services from Time Warner Cable on New Year’s Day when their carriage contract expired. The companies remain far apart on terms, and don’t even have plans to resume negotiations. That’s a big risk for MSG: Time Warner Cable accounts for about 2.5M MSG subscribers, about a third of its total. The $112M that the cable company pays annually for the channels amounts to about half of Madison Square Garden’s estimated cash flow for its current fiscal year. But execs close to both companies say that Dolan is determined to show that he’s no pushover. The part time blues guitarist knows he’d probably have to kiss MSG’s music channel Fuse goodbye if he allows Time Warner Cable to drop it — something the pay TV company says it wants to do because so few people watch it. Dolan’s main job as CEO of Cablevision gives him an additional incentive to show his moxie. Time Warner Cable has long pined to consolidate its hold on the New York market by acquiring Dolan’s cable company. Investors wonder whether he might consider an offer: Cablevision shares fell more than 56% over the last year amid concerns that the company will find it hard to grow — especially after last month when its respected COO Tom Rutledge quit to become CEO of Charter. Does Dolan need to show he’s tough to avoid a fire sale?

Time Warner Cable is equally motivated to dig in its heels. CEO Glenn Britt is leading the pay TV industry’s charge against rising programming costs — especially for sports channels. He has said that he’d like to offer them on a separate tier to give a break to cost conscious viewers who don’t watch sports. If Britt caves in to MSG, then he’d have little leverage to bargain with powerful programmers including ESPN, or NBCUniversal’s newly revamped NBC Sports Network.

How will this play out? A lot depends on the New York Knicks. They’re MSG’s main attraction. If  they make it to the playoffs, Time Warner Cable risks losing subscribers to a service that offers the games. MSG is trying to motivate them by hosting free viewing parties in New York City where staffers will help people to ditch Time Warner Cable. But if the Knicks stumble, then MSG investors will have to decide how long they can continue to see the company lose cash while they try to figure out whether Dolan’s playing for their team.