The current contract between CBS stations in more than a dozen markets, including New York and LA, and AT&T-owned satellite giant DirecTV, DirecTV Now and U-verse cable systems expires Friday at 11PM PT. The spat comes at the same time that local stations owned by Nexstar have also hit an impasse with AT&T, leaving those stations dark for the past two-plus weeks.
In a lengthy statement Friday morning, AT&T said it has “offered to pay CBS an unprecedented rate increase and the highest fee we currently pay to any major broadcast network group. CBS has refused.”
In addition, the company said its request to be allowed to sell CBS All Access, in the way that Amazon, Roku and Apple do, was denied. “The reason for CBS’ refusal is because CBS and other companies that own local CBS affiliates – such as Nexstar, Tribune and Sinclair – want to limit customers’ choices so broadcasters can keep using blackouts to cut off consumer access and inflate their fees. Either way, consumers lose,” AT&T said.
AT&T went on to claim that “CBS is intent on blacking out any home that chooses to receive cable or satellite service to up-sell CBS All Access subscriptions.” According to AT&T, CBS has said publicly that it “priced All Access that much higher to capitalize on customers it can capture from cable, satellite or other means of distribution.” The service costs $6 a month with limited ads and $10 a month for the ad-free version.
CBS had no immediate response to the AT&T statement when contacted by Deadline.
The dynamics of carriage battles have evolved significantly in the streaming era. In some instances, pay-TV operators have gone as far as encouraging customers to sign up for networks offered as stand-alone streaming apps, typically when they also are providing broadband service to the same customers. For AT&T (as with Dish Network’s long-running feud with HBO), there is less opportunity to provide internet service. Recent messages from AT&T have pointed customers to over-the-air signals and the non-profit local TV streaming app Locast and have not mentioned All Access as a way of getting the CBS signal.
A source familiar with the deal terms tells Deadline one reason for the friction is that the contract that is expiring has run for seven years, an eternity by this decade’s fast-evolving standards.