With Deal Expiring Today, Sinclair Could Be Dropped By DirecTV & AT&T TV NOW, with FOX Caught in The Middle

Negotiations can be tough and the case is no different for Sinclair and AT&T who have been feuding over retransmission fees—the money AT&T pays to carry local channels. Pending another extension, if AT&T and Sinclair can’t come to terms by today at 5pm ET, DirecTV, AT&T U-Verse, AT&T TV, and AT&T TV NOW customers across the country could see 136 local affiliates dropped, in addition to Sinclair-owned Tennis Channel. Sinclair’s recently purchased Fox Regional Sports Network are not a part of the current deal, so they won’t be affected.

Losing Sinclair locals would be a major blow to customers with NFL and College Football seasons well underway. But the biggest impact might be to FOX. Just yesterday Dish Network dropped 17 FOX O&O locals in major markets like New York, Chicago, and Los Angeles. Since Sinclair is the largest owner of the FOX affiliates, with over 50 affiliates, it would be a major blow for the network as it tries to launch their new series, especially with WWE Friday Night Smackdown! premiering on FOX for the first time next week.

Last week, David Gibber, Sinclair’s Senior Vice President and General Counsel said:

AT&T is the largest MVPD in the country and seems intent on using its tremendous market power to dictate to viewers which programming from other content providers they can receive, even as they continue to acquire content providers and push their own content to viewers

Despite the tremendous market power of AT&T, most consumers of AT&T and DirecTV do have some other alternatives to receive our in-demand programming. Although it would be unfortunate to lose AT&T and DirecTV as customers, we are simply not prepared to sell our programming to them at the below market rates they are demanding due to their overwhelming market power.

Sinclair has already been affected by the blackouts, as 19 of their local affiliates in which they had JSA agreements were dropped by AT&T in June. The company also had all of their CBS affiliates, which are negotiated by CBS directly, dropped by DIRECTV NOW in late-July.