Thursday, March 11, 2004

Viacom back on Dish

Well, the Viacom stations re-appeared on the Dish this morning. Dish and Viacom struck a deal overnight and got the channels back up within 20 minutes of signing the contract.

Personally, the impact was pretty minimal - about the only thing we missed that we can't recover with the PVR later was two nights of The Daily Show.

Observers are saying this worked out to be a bad move by Dish, and I'm sure there are subscribers who got so pissed off that they called the cable company or DirecTV within hours of Viacom going dark.

But I still stand behind Dish. Even if the terms they reached this morning were no different than what was offered before the blackout, it sets a precedent for the company in their future dealings with content providers. Charlie Ergen has showed he's not willing to just roll over and accept whatever terms Viacom, Time-Warner or Disney decides to throw out the next time a contract is up.

So Charlie stuck it out and probably lost a few customers. But his stock price (always important in public-company land) is pretty much unchanged since Tuesday and his stance probably will help keep Dish's content costs down, which means better value for customers, which means more subscribers in the long term.

Viacom, on the other hand, won nothing. The best case scenario is that they got the terms there were looking for initially, but in the meantime their stock dropped 3% on the blackout, they no doubt spooked some advertisers and they come off looking like the bully, thanks to Charlie's populist, "aw shucks" persona.

In the eyes of (most of) Charlie's customers, he's a hero. And in the eyes of Time-Warner and Disney, he probably looks like a nut. But a nut who is willing to take their channels off the air and freak out the market if you try to screw him.


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