Dish CEO Ergen Says Local Station Carriage More Important Than Bally Sports RSNs, But “Other Ways” to Get Locals

On the heels of a release by Sinclair Broadcast Group Monday morning threatening to drop 112 network stations from the satellite carrier on August 16 over a carriage dispute, Dish CEO Charlie Ergen said he was disappointed that the broadcaster issued a release so early in the negotiation process. Ergen’s comments came during Dish's Q2 2021 Earnings Call.

If the two sides can’t come to terms before August 16, Dish customers across the country could see 112 of Sinclair’s broadcast stations being dropped — including 102 ABC, CBS, NBC, and Fox network affiliate stations, in addition to Sinclair-owned Tennis Channel.

“First of all, I’m disappointed that they put a press release out that that they expected the network to come down, since I think we have till August 16,” Ergen said. “Obviously, many negotiations come down to the wire so, we’re still going to bargain in good faith and hope. (But we’re) disappointed they seem to have come to the conclusion the channels are coming down.”

As opposed to concentrating on the carriage of Bally Sports RSNs, Ergen said his concern was with ensuring carriage of the local broadcast stations.

“We don’t have any customers calling us on RSNs today, (but) if the local channels were to go down, we would have more than one customer call us the next day and say, ‘where’s my local channels’ in a particular market,” Ergen said. “So, our focus is on making sure that our customers aren’t disenfranchised for the local channels.”

Ergen pointed out two things in relation to the networks.

“The good news for our customers are, they have other ways to get their channels,” he said. “First of all, they watch them less; the networks less. And, they have other ways to get those networks that they haven’t had in the past.”

As far as Sinclair is concerned, Ergen looked at the double-edged sword that appears to be in play regarding carriage of local television stations as well as the Bally regional sports networks.

“We’re empathetic to Sinclair because they’re having to compete against their own content providers, and we’ve had a long-term relationship with Sinclair — and it’s been good,” Ergen said. “we’ve been able to work through issues as tough as this one over the years. The regional sports question is that they realize that Sinclair didn’t own the regional sports networks. When those networks came up for renewal, by the time Sinclair owned and was able to negotiate on their part, we thought our customers that wanted regional sports had left.”

Ergen said that most of his customers who were interested in a regional sports package had already left Dish to find regional sports coverage elsewhere.

“Almost nobody who was left who wanted regional sports networks. They’d gone somewhere else to get them,” Ergen said. “I think there’s innovative ways to reinvigorate the regional sports networks. Sinclair themselves talked about it in a direct-to-consumer product. I think there’s other ways to do that. And we’ll continue to work with Sinclair — to the extent that they want to try to work with us on a win-win situation.”

Ergen was very specific when he talked about the bottom line that both sides are looking at in the deal: money. That being the case, while he reiterated his disappointment over Sinclair’s Monday release, he said he understands what a channel is worth.

“At the end of the day, it’s about money, it’s about economics. That hasn’t changed in any programming negotiation that I’ve ever been involved in, right? And one thing that we do differently is we have viewer metrics, and we know what the cost to the viewer is and how — and we have a — we have knowledge of how the customer values a channel. And if you get real-time viewing data as we have for the last 7 or 8 years, you can be pretty precise on what a channel is worth. And that’s the metric we use,” Ergen said. “If you’re on the other side of it, most programmers just have a budget. And they have a number they give Wall Street or whatever it is, and they just say, ‘Here’s the number we want.’ And sometimes, those are pretty far apart.”

Ergen said he hopes the two sides can come to closure before the August 16 deadline and that customers will not be inconvenienced by an outage.