Viacom Channels to be Dropped by DirectTV

The companies can't agree on carriage fees for cable channels

DirectTV (NASDAQ:DTV) subscribers may find themselves without a number of channels, including Comedy Central, MTV and Nickelodeon after midnight tonight.

The satellite TV service has failed to come to terms with Viacom (NASDAQ:VIA) over carriage fees for its cable networks and the channels may go dark until an agreement can be reached, Reuters notes.

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Shares of DirectTV slipped a little more than 1% in Tuesday afternoon trading, while shares of Viacom fell almost 3%.

Viacom officials lamented the impasse on the company website, saying that they had made their “best efforts” to come to a deal.

DirectTV complained that Viacom is requesting a 30% increase in fees for its stations, which the company argues is unreasonable, especially in light of slipping ratings at once-popular channels like Nickelodeon.

The satellite service also contends that if Viacom wants to drastically increase its rates, DirectTV subscribers should be able to select which Viacom channels they wanted to subscribe to, instead of having to pay for all of them.

Clashes between subscription TV service providers and broadcasters are becoming more common as media companies try to boost revenues by raising the fees they charge service providers to air their channels. Dish Network (NASDAQ:DISH) dropped AMC (NASDAQ:AMCX) from its service earlier this month after the companies could not conclude an agreement over carriage fees.

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