Optimum TV customers in the New York area were warned of an ongoing carriage dispute on Monday that might take several local teams off the air as soon as the ball drops on New Year’s Eve.
According to a report in The Desk on Monday, MSG Networks — the television home for the New York Knicks, New York Rangers, New York Islanders, and New Jersey Devils — is locked in a dispute with Altice USA, the parent company of the Optimum TV cable service. Should the two sides fail to reach an agreement, MSG Networks programming could go dark as soon as New Year’s Day.
As per usual, the carriage dispute centers around the pricing and tiering of MSG Networks on Optimum’s cable systems. Optimum would like to place MSG Network in one of its more premium, higher-priced offerings. MSG Networks would like to stay on a more basic tier with wider reach, thereby collecting carriage fees from a broader pool of customers, some of whom may not watch the channel at all.
In a statement sent to The Desk, Altice USA said that MSG Networks is “demanding exorbitant programming fees, which could raise our customers’ cable bills.” The company also reiterated its issue on MSG’s preferred tiering saying, “To add insult to injury, MSG Networks is requiring us to make their channels available to the vast majority of Optimum video subscribers, which would force customers to pay for content they may not want to watch.”
One of the sticking points for Altice is that MSG Networks’ programming is available on the direct-to-consumer streaming service, MSG+. That option gives customers who require MSG Network’s programming an alternative outside of the pay TV bundle. In other words, MSG Networks have gone from a “must-have” to a “nice-to-have” for Optimum.
An MSG Networks spokesperson told The Desk that Altice has rejected all of the network’s offers. Later, MSG Networks provided Awful Announcing with the following statement:
Despite our good faith efforts, Altice refuses to offer anything close to market terms, making it impossible for us to agree to their unreasonable demands. Their marketing slogan is ‘Where Local is Big Time,’ but they may deprive Optimum subscribers of their favorite sports teams shortly when their contract expires – there’s nothing optimal or local about that.
An Optimum spokesperson told AA there wasn’t an extension offer from MSG, saying “An extension was neither offered nor declined. With that said, Optimum wants to partner with programmers who are putting customer choice and flexibility at the center of every decision. We would be happy to agree to an extension if they approached these negotiations like partners and worked with us to find solutions that benefit our customers and their viewers. Unfortunately, that has not been their approach to date.”
Such disputes have become commonplace between regional sports networks and pay TV providers. Regional sports networks are among the most expensive channels in the cable bundle, yet have typically been included in distributors’ base packages.
Now, with the economics of cable television becoming less sustainable with each passing year, including an expensive regional sports network that many customers might not ever watch in a base package doesn’t make much sense; even less so considering there are over-the-top alternatives.
Regional sports networks are now faced with the difficult reality of negotiating from a place of substantially diminished leverage, something that has rarely happened for most of their history.
Given that MSG Networks and Altice couldn’t even agree to an extension, this dispute seems destined to drag on. NBA and NHL fans with Optimum in the New York area will likely be forced to find an alternative way to watch their favorite teams in 2025.
Suffice it to say, that’s probably not the New Year’s gift that New York sports fans were hoping for.
This post was updated to include statements from MSG Networks and Optimum.
[The Desk]