Just so you didn't think FOX and TWC were the only shenanigans going on as the clocks strike midnight...
FOOD NETWORK, HGTV ENLIST VIEWERS’ HELP TO KEEP POPULAR LIFESTYLE NETWORKS ON CABLEVISION
Cablevision Refuses to Recognize Value; Subscribers Will Miss New Year’s Premieres
KNOXVILLE, Tenn. (For Immediate Release – Jan. 1, 2010) – Two of Scripps Networks Interactive’s (NYSE: SNI) top-rated television networks – Food Network and HGTV – went off the air on Cablevision systems in New York City, Long Island and the Tri-State Region at midnight New Year’s Eve after the cable operator failed to negotiate acceptable rates for the programming distribution rights.
Cablevision’s contract allowing it to carry Food Network and HGTV expired at midnight, Dec. 31.
As a result of Cablevision’s decision not to negotiate new distribution agreements, Food Network and HGTV were dropped from the cable operator’s channel lineup.
Scripps Networks Interactive and its Scripps Networks operating division have launched a consumer campaign appealing to Cablevision subscribers to tell their cable company how much they value Food Network and HGTV. Subscribers are being encouraged to log on to iloveFOODNETWORK.com and iloveHGTV.com for information on how to demand that Cablevision put the two networks back on the air.
“Viewers love our talent and our shows, which is why Food Network and HGTV rank among the top networks in cable,” said Kenneth W. Lowe, chairman, president and chief executive officer of Scripps Networks Interactive. “But our valuable networks simply are not being compensated like top ten networks by Cablevision. The distribution rates Cablevision pays for Food and HGTV are among the lowest in the industry.”
According to 2009 Kagan Research Data, among the 79 Nielsen-rated networks, Food Network ranked 75th and HGTV came in at 72nd in terms of average rates received from distributors per subscriber. Conversely, Food Network has grown its viewing audience at a record-setting pace over the past five years. Food Network and HGTV shows and on-air hosts consistently rank among the viewers’ “favorites” in annual subscriber surveys.
Cablevision, which serves about 3 million television viewers in the New York City, Long Island and the Tri-State Region, charges its subscribers an average fee in excess of $83 per month. Of that, Food Network and HGTV combined receive less than 25 cents per subscriber. That’s a sharp contrast to the value cable subscribers on the whole place on the two networks, according to a recent independent survey.
The 2009 Beta Cable Subscriber Study found that the average cable subscriber believes Food Network is worth $1.03 per month and HGTV is valued at 73 cents per month, which is considerably more than Cablevision has been paying for the networks’ programming and more than Scripps Networks Interactive is asking on behalf of the two brands in current contract negotiations.
“The rates we are seeking represent a very modest increase when you consider that Food Network and HGTV are among the top networks in all of cable,” said John Lansing, executive vice president of Scripps Networks Interactive and president of the company’s Scripps Networks operating division. “Even with the rate reset we’ve proposed, about 35 other networks will be receiving higher fees per subscriber than these viewer favorites.”
Brooke Johnson, president of Food Network, noted that Scripps Networks invest distribution fees it receives from Cablevision and other cable and satellite companies in developing on-air hosts and in creating the relevant and entertaining programs that keep viewers coming back to watch Food Network and HGTV.
“It’s hard to maintain delivery of programming that viewers rate among their favorite shows when we’re getting short changed – and I mean significantly underpaid in the case of Cablevision – when compared to what this cable company is paying other, comparable networks for programming,” Johnson said. “We’re hoping the viewers can convince Cablevision to get Food Network back on the air so that they won’t miss the great shows coming up in the New Year, including Worst Cooks In America and the huge Super Chef Battle: An Iron Chef Event.”
Lansing stressed that Scripps Networks Interactive remains open to negotiating new distribution agreements with Cablevision.
“It’s very disappointing that Cablevision refuses to recognize the value that its own subscribers place on Food Network and HGTV, so we’re creating a forum for those viewers to make their voices heard,” Lansing said. “When you consider how popular Food Network and HGTV are, you have to wonder if Cablevision has lost touch with what matters most to its customers.”
Food Network, which is widely credited for redefining the food genre on television, has experienced five consecutive years of ratings growth, and 2009 was a record year by virtually every measure. The network posted the highest-rated primetime in its history this year with a 19 percent increase over year-ago levels. Food Network significantly grew its upscale audience with a 29 percent gain over 2008. The network also saw a 10 percent increase in total viewers, according to Nielsen Media Research.
Likewise, HGTV is coming off a stellar year. In 2009, the network averaged 1.2 million viewers in primetime, an increase of 9 percent over 2008, led by popular programs like House Hunters, House Hunters International and Divine Design. HGTV plans to launch several new programs in January, including the highly anticipated New Year’s Day special, HGTV Dream Home 2010.
Food Network and HGTV are distributed to about 99 million U.S. households, with carriage provided by every cable, satellite and telecom provider across the country. In the 16 years the networks have been on television, neither Food Network nor HGTV has ever been off the air because of a contract dispute with a distributor.
“Historically, our relationship with distributors has been positive and mutually beneficial,” said Jim Samples, president of HGTV. “We want nothing more than to reach an agreement, one that recognizes the value our networks deliver to Cablevision and its customers every day.”
Besides logging on to the HGTV and Food Network websites, Cablevision subscribers also can call 866-695-BEST (866-695-2378) to learn more about how they can help get Food Network and HGTV back on the air.
About Scripps Networks Interactive
Scripps Networks Interactive (NYSE:SNI) is one of the leading developers of lifestyle-oriented content for television and the Internet, where on-air programming is complemented with online video, social media areas and e-commerce components on companion Web sites and broadband vertical channels. The company’s media portfolio includes Lifestyle Media (Scripps Networks), which is comprised of popular lifestyle television and Internet brands HGTV, Food Network, Travel Channel, DIY Network, country music network Great American Country, and the Fine Living Network, soon to be rebranded as the Cooking Channel; and Interactive Services, with leading online search and comparison shopping services BizRate and Shopzilla.