Not So Fast…
I referenced it earlier but today’s Mediaite column by Joe Concha on the Dish/FNC spat deserves its own fisking.
When the final gun sounded and scores are tallied up in the dispute between Dish Network and Fox, the only conclusion that can be made is that Dish…got served.
Uh…no it can’t. Not yet anyway and certainly not for most of the reasons Concha cites…
So how did Fox win? Simply put, they had the horses in the form of O’Reilly and Kelly, the message (“censorship”), but most of all, passionate viewers of Fox News voting with their wallets — the kind of viewers who execs even at other networks will tell you are the most notoriously loyal of any out there, free or cable.
Let’s look at these individually…
“The Horses” – That is debatable. If FNC had launched that kind of full court press from the very begining with O’Reilly and Kelly doing the advertising Fox put on its other channels, you might be able to argue they played a key role. But Fox was slow to take that step so their impact in moving things along is ultimately unclear.
“The Message” – Oh please. Censorship? Come on. That dog could never hunt. Nobody at Dish was censoring FNC. If anything, 21st Century Fox censored itself when it yanked the channels. If anyone actually believed that gibberish it’s because they weren’t really paying attention to what was going on. That may have indeed happened – and there’s no way to know for sure – but it wouldn’t have happened because the message was true, it would have happened despite it not being true.
“Passionate viewers” – Well there’s no doubt that FNC viewers are passionate. That was never the issue. The issue was whether there were enough of them to make a difference. That point is open to conjecture. The “tens of thousands” of viewers Dish lost aren’t coming back – Concha is right on that point. But the question is were they enough to make Dish flinch? Even if they were the full 90,000 (as of last available number), something very unlikely, that isn’t enough to move Dish given it’s still 1% of Dish’s subscriber base.
But all of this is tangential to what was the central issue in this spat; Fox wanting to add in Fox Sports 1 and possibly others (FXX) to the negotiation process.
Concha pooh-poohed that today…
Note: There’s always a few demands that are expendable in negotiations like this, and Fox Sports 1 being bundled in (if Dish completely capitulated) would have fallen into the nice-to-have instead of must-have category.
Concha underestimated the significance of the attempt at force bundling by Fox. But you don’t have to take my word for that. You can take Fox’s.
Dish, however, insists it’s Fox that has forced the two sides apart. “It’s like we’re about to close on a house and the realtor is trying to make us buy a new car as well,” said Warren Schlichting, Dish Network’s SVP of programming. “Fox blacked out two of its news channels, using them as leverage to triple rates on sports and entertainment channels that are not in this contract.”
Fox argues Dish has simply failed to change with the times–which are changing dramatically.”When you won’t accept that businesses evolve, that relationships and partnerships evolve. And the way we deliver content changes. And we both need to adapt. Dish hasn’t changed its packaging since 1993. That kind of marketing and that kind of packaging is outdated.”
You see it right there. Fox responded directly to the charge that Dish made that Fox yanked the channels because Dish didn’t want to play ball negotiating for channels that weren’t part of the FNC/FBN negotiation and it did so by saying Dish wasn’t adapting.
If the extra channels were never a sticking point for Fox, the network never would have bothered to call Dish out for not keeping up with the times. If it was expendable, Fox wouldn’t have gone out of its way to make those channels part of its PR campaign to explain why things were at the impasse they were.
To drive this point home, we need to look at what also happened yesterday with the Dish/Fox lawsuit.
In a court document filed on Thursday, the parties say that they believe “it is highly likely that the negotiation later this year of a renewal of their 2010 agreement will result in resolution of this lawsuit.”
My read is by getting Fox Sports 1 decoupled from the FNC/FBN negotiation, Dish and Fox were able to quickly resolve that skirmish and move forward on the real battle. I think Dish was always going to give Fox most of what it wanted on FNC/FBN, though maybe it sweetened the deal to make the other channels Fox brought in go away. And that’s why it was never really about “the horses” or “the message” or “the passionate viewers”. It was about finding a resolution to the lawsuit.
This is why how these upcoming negotiations turn out will be the ultimate decider of who won the war between Dish and Fox. If for example Dish pays a hefty fee to get those channels that are part of this agreement in order to make the lawsuit go away, then Fox would indeed be the clear winner. If Dish ends up yanking The Hopper to settle the lawsuit, Fox would be the clear winner. But it could turn out to be a push…it could turn out that whatever increase Dish pays isn’t such an onerous one that having the lawsuit go away without Dish having to scrap the Hopper means both sides get a significant win.
Either way, what happened yesterday doesn’t indicate who is going to come out ahead nor does it indicate that Fox’s tactics to put pressure on Dish had the desired effect.