Dozens of local TV stations owned by Tegna, most of them NBC and CBS affiliates, have gone dark on DirecTV in a carriage dispute.
The companies failed to reach an agreement before a 5 p.m. PT deadline Thursday. The outage will immediately affect roughly 5 million customers in markets across the U.S.
DirecTV was spun off by AT&T in 2021 into a privately held entity that is 30%-owned by private equity firm TPG. DirecTV’s traditional satellite business, along with the internet-delivered DirecTV stream and the U-Verse cable systems combined have nearly 12 million subscribers in the U.S., according to recent analysts’ estimates.
The Tegna battle affects about 40% of that base, sources indicated to Deadline, with 70% of affected stations being affiliated with either CBS or NBC. Tegna owns 66 stations in 52 markets, including in top such DMAs as Dallas, Phoenix and Denver.
Rob Thun, CEO of DirecTV, faulted the stance of Tegna and other programmers in the current marketplace. “We’re not going to make it up on volume, we’re going to make it up in price,” he told Deadline in an interview, characterizing the bargaining approach of programmers, with carriage fee demands increasing “precipitously” in recent renewal cycles. “If that’s the mentality, you’re going to drive more people out the door because price is what’s driving everyone out of pay-TV.”
Said Tegna in a statement this evening: “Despite months of effort, DirecTV has refused to reach a fair, market-based agreement with Tegna. As a result, DirecTV and AT&T U-Verse customers will lose access to NFL and college football conference championship games, as well as some of the most popular national network programming and top-rated local news. We urge DirecTV to continue to negotiate with us until a deal is reached that restores our stations to their customers.”
Football is a key programming element that will be affected in the near term. Top-rated Georgia will take on Alabama in the SEC Championship on CBS on Saturday afternoon. Other major rivalries also are on the docket, such as the Army-Navy game on CBS on December 9. NBC’s Sunday Night Football is coming down the home stretch of the regular season.
Political news coverage and significant campaign advertising dollars are also hanging in the balance. DirecTV recently had a 77-day carriage impasse with Nexstar Media Group, another top local station owner. A battle of that duration with Tegna would keep stations dark through the Iowa caucuses on January 15, with 15 more states holding primaries through Super Tuesday in early March.
Unlike in previous distribution tangles, however, today most of the Tegna stations are carried on direct-to-consumer streaming services like Peacock and Paramount+. Thun said DirecTV is more of a “pure-play” pay-TV company than Charter, Comcast and other cable operators that also sell broadband service. That makes an approach like the one Charter took in its battle with Disney in September less of a viable options. Nevertheless, Thun said the company would likely begin telling customers they can get access to station programming via streaming. In similar fashion, the company has equipped major out-of-home customers like Buffalo Wild Wings with antennas that will enable them to get local station signals at no charge over the air if the blackout persists.
Tegna came into the negotiations on the heels of a major corporate setback. It had agreed to be acquired by private equity firm Standard General in a deal valued at $8.6 billion including debt, only to see federal regulators raise several concerns and effectively kill the transaction.