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News Analysis
Dish vs. Fox: Who's Losing?
By Swanni

Washington, D.C. (October 12, 2010) -- The fee fight between Dish Network and Fox Networks is now in its 12th day with no end in sight. Both companies have escalated the rhetoric in recent days, blaming the other for Dish subscribers being denied access to the Fox-owned FX, National Geographic Channel and 19 regional sports channels.

At this point, there would appear to be no winners or losers in the battle over whether Dish should provide additional compensation to Fox to carry the channels. (Their old fee agreement expired on September 30.) The one exception, of course: the Dish viewers who can't watch some of their favorite channels; they are clear losers.

However, another loser is rapidly emerging from the fog of loud charges and hysterical ad campaigns. And that loser is Dish Network.

The satcaster may be justified in saying that Fox is asking for an "excessive" fee to carry the FX, etc. It may even be right to suggest that Fox is trying to scare Dish viewers with the threat that they will lose their local Fox channels on November 1 if a new agreement is not reached for those channels as well.

But Dish is in a precarious position in the fight. The company has a long history of getting entangled in nasty legal scraps with industry partners, be it TiVo (six-year DVR patent war continues); Disney (Dish recently removed four Disney HD channels after the two sides could not reach a new programming pact; the channels are still off the air.); MSG (another programming fight has forced Dish to remove the sports channel from its lineup); Voom (Dish dumped Voom's HD channels from the air although it was a minority stake holder; a lawsuit ensued).

And I could cite perhaps a couple dozen more cases over the last decade.

You see, Dish CEO Charlie Ergen believes in playing hardball at the negotiating table. It often appears that Dish doesn't mind denying its customers a favorite channel for awhile if it means a few more dollars in its coffers.

But I have to think that many Dish subscribers are losing patience with this approach. How do you subscribe to a TV service that doesn't give you confidence that your favorite channels will be there when you tune them in. (Or, in the case of TiVo, it's possible a judge will rule that Dish must disable its DVRs at some point.)

The longer the battle with Fox, the more likely that Dish subscribers will bolt and sign up with a different TV provider, such as DIRECTV. And if Dish doesn't sign an agreement to keep the Fox affiliates, it could be a disaster. Again, Dish viewers can only take so much.

This is a case where Ergen needs to put his ego and even his principles on the shelf and make a deal with Fox. He doesn't have the luxury not to.

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Phillip Swann is president and publisher of TVPredictions.com. He has been quoted in dozens of publications and broadcast outlets, including CNN, Fox News, Inside Edition, The New York Times, The Washington Post, The Chicago Tribune, The Financial Times, The Associated Press and The Hollywood Reporter. He can be reached at swann@tvpredictions.com or at 703-505-3064.

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