UPDATED at 4:47 PM: As the Starz-Altice standoff continues, Starz parent Lionsgate says it has issued a cease and desist letter to Altice, alleging false statements to customers over what it describes as Altice’s decision to drop the Starz channel and 16 other Starz, Encore and Movieplex channels.
“It has come to our attention that Altice is providing false and misleading information to consumers with respect our renewal negotiations and the Starz signal,” the letter reads in part. “Specifically, Altice is advising its customers that Starz did not engage in extension discussions with, and pulled its signal from Altice. This is patently false. As you are well aware, while Starz was in the midst of actively negotiating the renewal, Altice unilaterally pulled down the Starz signal effective 12:01AM ET January 1, 2018 without providing any prior communication or notice to Starz or its customers.”
PREVIOUSLY, January 1: Last-minute negotiations over carriage rights for Starz and Encore on the Altice USA cable systems failed, resulting in the channels going dark as of the new year.
Altice claimed Starz refused a short-term contract extension past the midnight ET deadline. Altice serves slightly less than 5 million subscribers in the New York area and in Midwest states. It claimed that meeting Starz demands on fees would force Altice to charge subscribers more than the cost of Starz’s stand-alone streaming service.
“We are focused on providing the best content experience for our customers and continually evaluate which channels meet their needs and preferences relative to the cost of the programming imposed by content owners,” Altice USA said in a statement. “Given that Starz is available to all consumers directly through Starz’ own over-the-top streaming service, we don’t believe it makes sense to charge all of our customers for Starz programming, particularly when their viewership is declining and the majority of our customers don’t watch Starz.”
Starz responded: “Altice has shown an unwillingness to negotiate in good faith to the detriment of our shared customers, and they have removed STARZ from their platform. We remain available to discuss a fair and reasonable agreement that will serve the interests of our loyal subscribers.”
Later, Starz expanded its statement. “Altice wanted a drastic reduction in price that was totally inconsisten with the market and flew in the face of the record popularity of our programming. Quite simply, Starz wanted to negotiate a forward-looking agreement in the best interest of our two companies and our customers; Altice did not.”
For now, Altice USA will replace the 17 Startz-Encore channels with Hallmark Drama, Sony Movies, MGM HD, HD Net Movies, Flix, and Cowboy Channel. Altice also said “certain customers” will be given Showtime sibling The Movie Channel for free.
EARLIER Dec. 30: In regards to the distribution agreement between Altice and Starz, Altice USA spokesperson, Lisa Anselmo told Deadline: “We are focused on providing the best content experience and continually evaluate which channels meet the needs and preferences of our customers relative to the cost of the programming imposed by the content owners.”
“Since our last contract renewal, Starz began offering a direct to consumer streaming service, which drastically changes the value proposition their network provides us and our customers,” she added. “Yet Starz is asking for outrageous increases in programming costs and, given the limited viewership of Starz amongst our customer base and the different ways consumers can directly access Starz content, we are working to reach an agreement that is reasonable and reflects the best interests of all our customers.”
Anselmo goes on to say that Starz insists on terms that would charge customers more than OTT product costs, which would be a bad deal for consumers who can get the service for less directly from Starz. She says they are looking to keep customers’ costs down.
“Despite Starz’ allegations, we have been negotiating and made several meaningful offers over the course of the negotiations including as early as today,” said Anselmo. “It’s disappointing Starz chose to make our negotiations public and instead they should focus on the negotiations.”
EARLIER: Starz Networks recently gave a statement in regards to the status of negotiations with Altice which could see a potential loss of all of Starz’s programming services when its distribution partnership expires at midnight Jan. 1.
“Starz has been working in good faith to reach a fair and reasonable distribution agreement with the team at Altice in order to continue providing our subscribers with all 17 Starz, StarzEncore, and MoviePlex premium channels,” Starz said in a statement obtained by Deadline. “We’re the second-largest premium pay network and the only premium television content provider focused on creating programming for underserved African American, Latino, female and LGBTQ viewers, with original series like Power, Outlander, American Gods, Ash vs Evil Dead and hundreds of blockbuster movies.”
The statement adds, “But rather than negotiating in a meaningful way, Altice is demanding a totally unreasonable agreement unlike anything that has previously existed in our longstanding partnership. We urge them to join with us in working to reach an agreement that is fair, reasonable and operates in the best interests of our customers, many of whom cannot otherwise find programming that speaks directly to them.”
Starz has made a name for itself as the second most subscribed to premium network. They recently signed new deals with Verizon and Hulu. The aforementioned series Power and Outlander have proven to be major grabs for Starz. Power is ranked number one for African Americans in premium television while Outlander gained a loyal audience and in 2017, was the number two ranked scripted series behind Game of Thrones among women viewers.