After weeks of high-stakes brinksmanship and a last-minute extension, Time Warner Cable cut a deal Friday night to pay an unspecified per-viewer fee to transmit Fox programming from News Corporation-0wned stations broadcasting in New York, Los Angeles, and a number of other major cities. Fox Broadcasting has traditionally been a cash cow for money-losing News Corp properties like Fox News and the New York Post.
Fox was asking for $1 per viewer for programs that are available for free over the air. According to Time Warner, independent Fox affiliates in smaller markets were charging a lot less money.
Fox faced the loss of advertising revenue from 13 million homes. Time Warner had more at stake. Customers who switched to satellite or alternative cable systems in search of Fox content would also be putting their high speed internet, pay per view, telephone and HDTV business in play.
Time Warner is currently in negotiations with Scripps Networks over higher fees for the Food Network (25 cents) and HGTV (40 cents), roughly triple what they cost now. Complicating that negotiation: rival Cablevision refused, and no longer plans to carry those channels, so added to the value of keeping loyal viewers is the possibility of poaching Cablevision customers jumping ship.