DISH Network subscribers may lose KGAN, KFXA on Thursday

Negotiations over fees are breaking down

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CEDAR RAPIDS - Two Cedar Rapids television stations, KGAN-CBS 2 and KFXA-FOX 28, could be blocked from DISH Network come Thursday if the stations' owner and DISH can't overcome problems reaching a new retransmission agreement.

Sinclair Broadcast Group wants DISH to pay more for its consent to retransmit the company's stations and is threatening to withdraw consent at 12:01 a.m. Thursday, Aug. 17, 2012, unless it can reach terms with DISH.

DISH released a strongly worded statement Monday criticizing Sinclair's demands, saying they would lead to significantly higher DISH Network rates if DISH agreed to them.

"We carry more than 1,800 local broadcast stations nationwide. Sinclair is asking for more than any other station anywhere in the country," said Dave Shull, DISH's senior vice president of programming.

"This goes beyond pure corporate greed. It's profoundly insensitive to the needs of the public," Shull said.

Sinclair Broadcast Group's general counsel, Barry Faber, countered that viewership of the Sinclair stations warrants higher fees. He said Sinclair is asking to be compensated on a per-viewer basis. He suggested that DISH negotiate lower payments for the lesser viewed stations  to provide more reasonable payments to the most popular stations.

"Our customer is DISH, and our costs have gone up tremendously," Faber said. "We pay for the programming we provide, and it's the most popular programming around."

The dispute is being watched by Iowa's largest cable TV company, Mediacom, which has gone through its own retransmission consent breakdowns with Sinclair. If Sinclair pulls its stations from DISH, it could improve Mediacom's competitive position with disgruntled DISH subscribers.

One indication the contract won't be settled easily is Faber's statement that Sinclair's retransmission fee demands aren't even the biggest issue on the table.

Faber said Sinclair disagrees with technology DISH is using to allow subscribers to delete commercials. Like several networks that are suing DISH over the technology, Sinclair receives much of its revenue from television commercials, Faber said. Allowing buyers of its programming to delete those commercials reduces the value of television advertising, he added.

Englewood, Colo.-based DISH serves more than 14 million satellite TV customers. The agreement covers about 70 stations that are owned, managed or otherwise represented by Sinclair.

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