The ongoing feud of 2009 has now spilled over into the new year of 2010. News Corp.’s Fox television stations are still broadcasting Time Warner systems as both companies agreed to extend the contract talks into January. While they say that the negotiations still remain cordial, the talks were only extended for three hours past midnight. There’s a lot at stake here. Time Warner customers, especially in southern California, could be without major bowl games this week like the Sugar and Cotton Bowls as well as the NFL games. All stations and companies make the most money off advertising and I would hate to be a company that bought a million dollar spot in the Sugar Bowl.
If you’re really desperate to watch Fox (and that’s if it’s off air), you’re either going to have to get alternative service or get a satellite subscription. All of these problems stem from the higher fees that News Corp. is demanding. To show the current discrepancy in value, News Corp. is asking for $1 per month per 4 million subscribers while Fox is countering with 25-30 cents. With almost 75 cents separating the two, this could prove costly for both, on this side and in the long run.
While I understand that there is a lot of money involved, I think that the costs could heavily outweigh the benefits. Sure News Corp. might strongarm Fox into paying a higher rate, but will that really offset all the money that could potentially be lost in advertising? One thing is for sure, the economists for both sides are sure smarter than me. One thing for certain, Fox and News Corp. could both suffer severe backlash, probably not devastating to either, but it’s still a wound.
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