Why isn't CBS on AT&T?
Over carriage, CBS and AT&T have had a little spat; since then, CBS stations were kicked off of AT&T video services on July 20, 2019. This affected AT&T Internet TV, DIRECTV, U-verse TV, and AT&T TV NOW (formerly known as DIRECTV NOW) customers spread throughout the US. Therefore why did this occur and at what point in time might it be fixed? Here's a breakdown:
A Carriage Dispute is a situation where a carrier party has refused to render carriage services and/or facilities to the shipping party for the shipment of the cargo.
A carriage dispute is a disagreement that occurs between a ‘carriage service’ which is commonly a pay-TV provider such as AT&T and the ‘program provider’ which is a content owner such as CBS over the terms on which a channel or station should be carried. The content owner seeks to obtain more money to license out their channels/stations, on the other hand, the pay TV provider seeks to pay as little as possible for carriage fees to uphold consumer prices on subscribers. The consequence if an agreement is not arrived at before the expiry of their current contract is that the provider withdraws the transmission of those channels, hence a blackout.
Why Is This Happening With CBS and AT&T?
Simply put - money. However, it has been reported that CBS wants $2 per subscriber per month for the carriage of owned-and-operated CBS stations in major markets. That was a huge leap from the current 25 cents per subscriber that it receives from AT&T. AT&T argues that such demands translate to a 240% increase in fees for the same channel.
AT&T however wants fees to have lower multiple than a similar package it offered to Time Warner’s HBO, while CBS says the proposed fees are in line with deals they have with other providers, and that AT&T isn’t valuing its networks appropriately, pointing out that CBS has been the #1 highest-rated broadcast network for 11 consecutive years. As for the retransmission fee, AT&T responds that CBS is a broadcast network that customers can tune in to with an antenna, meaning that they should not be charged constantly rising fees.
This escalated to a situation where the two parties could not reach a consensus on a new contract before the last one expired, which led to AT&T removing CBS stations in those markets.
That brings us to the last question: Which AT&T customers are affected?
This is more than 6.6 million AT&T video subscribers that have been restricted from CBS stations, including CBS owned-and-operated stations in New York, Los Angeles, Chicago, Philadelphia, Dallas-Ft. Worth, other large cities include San Francisco, Boston, Atlanta, Seattle, Tampa, Detroit, Pittsburgh, Baltimore, and Portland among them. Lastly, Showtime and CBS Sports Network were blackouts nationally on AT&T video platforms as a result of the carriage dispute.
The blackouts affect subscribers in various ways depending on the market and service
- CBS has been removed from the platform for DIRECTV, U-verse TV, and AT&T TV customers in the affected areas.
- AT&T TV NOW customers across the United States cannot watch CBS and Showtime channels anymore or their content libraries.
CBS is one of the biggest networks that have been pulled off from AT&T and many consumers are wondering when it will be back online.
For the foreseeable future at least, the verdict must be that there is no definitive answer as to which side is right; both remain poles apart in retransmission discussions. CBS also stated that blackouts could last weeks, and even in the NFL regular season, if the agreement remains unsettled. The spins and PR attacks have already started increasing, which suggests that neither of them is willing to back down for now.
Carriage disputes though are usually determined before those absolute dates are reached. Subscriber fees alone are too big to be let go, then there is money from advertising, and, of course, the issue of not frustrating customers. Hope for some rationality to return at some point, probably with CBS getting a bit of a boost in their fee but not quite to the amount they wanted.
However, in the meantime, affected subscribers do have some ways, for instance, they may put up antennas to access other available CBS over-the-air signals in the market. Also, I heard of CBS All Access which provides live CBS but for that one has to pay an extra amount of money every month.
Perhaps, a balanced middle ground will be met shortly. However, CBS and AT&T are significantly apart on some of the financial terms whereby CBS subscribers are unable to access their programs and are left waiting.
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