After days of watching Fox run newspaper ads and TV promos, warning DirecTV subscribers that Fox channels including FX are about to be pulled off the service, DirecTV fought back with a complaint letter to the FCC.
The letter, sent from Derek Chang, executive VP of content strategy and development for DirecTV to Federal Communications Commission media bureau chief William Lake, accuses Fox of running misleading ads during ongoing dispute over carriage fees.
Specifically, DirecTV takes umbrage with ads run over the weekend in local papers indicating that Fox owned-and-operated channels — and not just select Fox networks and regional sports channels — will be pulled off the satellite service as part of the dispute.
Also read: Game Over, Man! Fox Ad Ramps Up DirecTV Carriage War
"In the midst of a dispute over cable programming, Fox is using misleading advertising informing DirecTV customers that “soon, in some markets, you may lose your local Fox station,” even though our retransmission consent agreement does not expire for over two months," Chang wrote.
Last week, Fox went public with details of an ongoing carriage dispute with DirecTV, announcing that the satellite service has threatened to pull its channels on Nov. 1 if a new contract can't be worked out.
The Fox Networks deal covers not only regional sports cable networks like Prime Ticket and Fox Sports West, but also FX and National Geographic.
A separate deal covering 27 Fox owned and operated stations is set to expire on Dec. 31 — a fact Fox alluded to Sunday in a full-page Los Angeles Times sports-secion ad (above), when it said it that Los Angeles viewers could also "soon" lose access to local stations Fox 11 and Fox 13.
Fox's willingness to tie other carriage negotiations to the public debate is, specifically, the nexus of DirecTV's complaint to the FCC Thursday.
Also read: 'American Horror Story' Creators Ryan Murphy, Brad Falchuk Join Anti-DirecTV Campaign
"The carriage agreement between DirecTV and a number of cable networks controlled by Fox Cable Networks, Inc. expired on September 30," Change wrote. "Although the parties have been negotiating for months, Fox continues to demand that DirecTV customers pay significantly more for the same channels they already receive. At present, DirecTV is carrying this programming under an interim extension agreement. If a new deal is not reached, DirecTV will suspend carriage of these cable channels on November 1."
Numerous published reports indicate that Fox is seeking carriage-fee increases of as much as 40 percent.
That would seem to be a public-relations liability, given the state of the global economy, and the price of cable and satellite service these days.
However, Fox has aggressively propagandized its points, Beyond the newspaper ads, Kurt Sutter, the foul-mouthed creator of FX's "Sons of Anarchy," taped a promo for FX in which he warns his show's DirecTV-subscribing fans that they could miss the last five episodes of the season unless they petition the service through Fox's "Keep My Nets" campaign.
(For his part, Sutter had to be restrained by Fox and its lawyers from issuing a more, er, stringent on-air rebuke to DirecTV.)
On Wednesday, Ryan Murphy and Brad Falchuk, creators and executive producers of FX's "American Horror Story," ran their own pro-Fox promo.
Asked if DirecTV had any plan to run a propaganda counter-offensive on its 101 Channel, a representative for the company told TheWrap that DirecTV officials "don't comment on company strategy."
Here's the full letter. More to come…
William T. Lake
Chief
Media Bureau
Federal Communications Commission
445 Twelfth Street, S.W.
Washington, DC 20554
Dear Mr. Lake:
I want to alert you to a disturbing development that relates to the broadcast stations owned and operated by Fox Broadcasting Company, Inc. (“Fox”). Specifically, in the midst of a dispute over cable programming, Fox is using misleading advertising informing DIRECTV customers that “soon, in some markets, you may lose your local Fox station,” even though our retransmission consent agreement does not expire for over two months. Furthermore while Fox continues to run these misleading ads, Fox has refused to provide us a separate offer for the continued carriage of its broadcast stations.
The carriage agreement between DIRECTV and a number of cable networks controlled by Fox Cable Networks, Inc. expired on September 30. Although the parties have been negotiating for months, Fox continues to demand that DIRECTV customers pay significantly more for the same channels they already receive. At present, DIRECTV is carrying this programming under an interim extension agreement. If a new deal is not reached, DIRECTV will suspend carriage of these cable channels on November 1.
Even if the Fox cable channels are no longer carried on November 1, the broadcast stations are covered under a separate agreement, which does not expire until December 31. Fox, however, is running advertisements asserting that DIRECTV viewers “soon could even lose” the Fox broadcast stations in their local markets. One such advertisement ran in the widely-circulated Los Angeles Times editions for Sunday,
October 23, a copy of which is attached hereto. In addition, Fox’s television advertisements on its local broadcast stations state that viewers could lose local channels (showing clips from Glee and NFL games) that are not subject to this agreement.
Ironically, at the same time it is airing these warnings, Fox has repeatedly refused to provide us with a separate offer for carriage of the Fox broadcast stations.
On the one hand, Fox has refused to negotiate in good faith for carriage of the broadcast stations. At the same time, it is informing DIRECTV customers that they may soon lose access to such stations, purposely conflating a potential November 1 deadline for cable programming with the additional loss of broadcast programming the delivery of which is assured through the end of the year. Fox is clearly abusing the public trust by its deliberate attempt to confuse and alarm consumers. Such conduct is certainly not what the Commission had in mind when it made Fox a steward of the nation’s airwaves entrusted to serve the public interest.
DIRECTV still hopes to arrive at a fair agreement with Fox before its subscribers are deprived of any programming. In the meantime, we have demanded that Fox immediately stop running advertisements that mislead consumers by suggesting that DIRECTV subscribers may not be able to receive Fox broadcast stations. To date, Fox has failed to do so.
Sincerely yours,
Derek Chang
Executive Vice President
Content Strategy & Development
William T. Lake
October 27, 2011