AT&T withholds content from subscribers rather than negotiate with broadcasters at fair market rates

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UPDATE: 7/11/19 IRVING, Texas – Nexstar Media Group, Inc. (Nasdaq: NXST) (“Nexstar”) set the record straight today with legislators, regulators, consumers and others related to ongoing negotiations between the parties on a distribution agreement that will allow AT&T to continue to offer Nexstar’s highly-rated network and local community programming to its subscribers.

The misinformation campaign began when AT&T indicated that “Nexstar pulled 120 of its local broadcast stations…”  Nexstar did not pull its stations or ask for their removal from AT&T’s DIRECTV, U-verse or DIRECTV NOW platforms.  Rather, Nexstar’s offer for a 30 day extension would have allowed consumers in the affected markets to continue viewing their favorite network shows, special events, sports, local news, and other programming while the parties continue negotiations.

AT&T in its “External Fact Sheet” and in communications to elected officials, erroneously asserts that Nexstar has been involved in blackouts with Cox Cable, DISH Network, Charter Spectrum “and others”  when in fact Nexstar has never had DISH Network or Charter Spectrum remove its stations from their consumer video offerings.  The facts are that Nexstar has established a long-term record of completing hundreds of agreements with multichannel video programming distributors (“MVPDs” or cable TV, satellite TV, telecom companies) for the carriage of its television stations and is proud that it has never, in its 23-year history, had a service interruption related to distribution agreements of the magnitude of the AT&T/DIRECTV interruption. Over the past 20 months alone, Nexstar has successfully renewed more than 390 distribution agreements with cable providers for the carriage of Nexstar’s stations, including a new agreement with Cox.

In contrast, following its 2015 acquisition by AT&T, DIRECTV has been routinely involved in disputes with content providers and has dropped or threatened to black out network and local community programming from Viacom, SJL Broadcasting/Lilly Broadcasting, and others. AT&T also fails to inform readers that between May 30, 2019, and June 10, 2019, alone, AT&T/DIRECTV customers lost access to the network and local content of at least 20 other non-Nexstar stations due to its failure to reach fair agreements with ten other broadcasters. At this time, AT&T has disputes with broadcasters and dropped local broadcast stations from several station operators (including Deerfield Media, MPS Media, GoCom Media of Illinois, Howard Stirk Holdings, Roberts Media, Second Generation of Iowa, Waitt Broadcasting, Mercury Media Group, Northwest Broadcasting and Nexstar), resulting in concentrated blackouts of local programming and service for its customers in thirteen U.S. markets (see table below).

Notably, in addition to its ownership of DIRECTV — the nation’s largest direct broadcast satellite service provider and in some markets, the sole source of a broadcast signal — in 2018 AT&T acquired Time Warner including global media and entertainment giants Warner Bros., HBO, Turner and CNN. 

A little more than a year after putting DIRECTV together with Time Warner, AT&T appears intent on using its new market power to prioritize its own content at the expense of consumers and insisting on unreasonable terms that are inconsistent with the market. As measured by stock market capitalizations, AT&T is approximately 50 times larger than Nexstar and the size disparity is even greater relative to the other broadcasters that AT&T has currently blacked out. As one legislator noted in his letter to AT&T’s CEO, “This cutoff seems to have the sole purpose of enhancing DirecTV bargaining leverage – with severe harm to Connecticut consumers.”

Nexstar wants nothing more than to bring its programming back to viewers by completing a new fair market agreement with AT&T and continues to negotiate in good faith to establish a mutually agreeable contract with DIRECTV.  Nexstar has offered AT&T/DIRECTV the same rates it offered to other large distribution partners with whom it completed successful negotiations within 2019 to date.

Viewers affected by the loss of service from DIRECTV have several alternatives to continue watching their favorite shows including local cable providers, DISH, over-the-air, certain subscription streaming television services, and services such as Verizon’s FIOS.

IRVING, Texas, July 9, 2019 – United States Senators John Thune of South Dakota and John Kennedy of Louisiana join Connecticut Senator Richard Blumenthal as well as legislators from West Virginia, Ohio, South Dakota, Massachusetts, New York and Alabama in issuing letters urging direct broadcast satellite service provider DIRECTV and AT&T U-verse to immediately restore carriage of Nexstar-owned stations.

In his July 8, 2019 letter Senator Thune stated, “I strongly encourage AT&T/DIRECTV to provide carriage of KELO-TV and KCLO-TV through August 2, 2019, as requested by Nexstar, so that the parties can continue negotiations without impacting consumers’ ability to view their local news coverage in the affected broadcast markets.” Similarly, in a letter directed to AT&T’s CEO, Senator Kennedy cites the probable impact to consumers in Louisiana at the height of hurricane season, stating “I am concerned that your failure to reach an agreement is negatively impacting Louisiana families. I am especially concerned about customers losing access to up-to-date weather information in the event that the tropical depression currently forming in the Gulf of Mexico turns into a hurricane.” In closing, Senator Kennedy requests of AT&T, “I encourage you to accept Nexstar’s offer of a short-term extension while you resolve your differences.”


https://www.nexstar.tv/wp-content/uploads/2019/07/Senator-Blumenthal-Letter-7-5-19.pdf

DIRECTV subscribers are no longer able to view WTAJ programming. This comes as DIRECTV and AT&T refused to accept an offer of an unconditional extension of the existing distribution agreement to allow the station’s owner, Nexstar Broadcasting Group, Inc. and DIRECTV/AT&T to reach a new agreement allowing the right to continue to air the highly rated programming.

Nexstar has negotiated in good faith and has presented a fair offer for our stations. Unfortunately, DIRECTV continued to deny the extension request and that is why the service has been removed.

Nexstar has recently completed hundreds of these types of agreements across the nation without any incident, and only DIRECTV and AT&T have elected to take our programming away from its customers.

Subscribers should call AT&T and DIRECTV directly at 855-937-9466 to demand that they keep WTAJ on.

Please feel free to visit this page to learn more to get WTAJ back on DIRECTV.

The full press release can be downloaded as a PDF by clicking the “download” button below.

Copyright 2019 Nexstar Broadcasting, Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

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