Viacom, DirecTV End Programming Blackout

Media Titans Come To Terms, Returning 26 Viacom Networks to 20M U.S. Viewers

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Viacom, owner of the MTV and Nickelodeon networks, reached a new programming fee agreement with DirecTV, ending a 10-day blackout for the satellite-TV service's 20 million U.S. viewers.

All 26 networks will return to DirecTV, Viacom said today in a statement. As part of the agreement, El Segundo, California-based DirecTV, the largest satellite TV service, has an option to add the EPIX channel to its offerings.

The agreement marks an end to the latest fee tussle between a pay-TV provider and program supplier, as rising content costs drive customer bills higher. About 14 million Dish Network customers have lost access to AMC Networks channels since last month. Viacom has said its programs amount to 20% of DirecTV's audience. The satellite provider cited shrinking audiences for Viacom shows.

The parties had been negotiating for several months and extended their seven-year agreement past the original June 30 expiration while talks continued, Viacom said.

Viacom's 26 channels, including MTV , Nickelodeon and Comedy Central, went dark for almost 20 million DirecTV subscribers just before midnight July 10.

Prior to the agreement, DirecTV said in a blog posting that Viacom was demanding a 30% increase in fees over the term of a new contract, amounting to more than $1 billion in additional costs.

Viacom said its fees account for less than 5% of the satellite service's programming expenses, and that DirecTV enjoyed below-market rates "for a very long time."

Bloomberg News

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