March 12, 1999 15:18
FOCUS-DirecTV,networks reach deal to restore shows
By Aaron Pressman
WASHINGTON, March 12 (Reuters) - DirecTV Inc., the largest U.S. provider of satellite television service, on Friday reached agreement with the major TV networks to return network programming to many of its customers.
The Hughes Electronics Corp. unit and the networks said they negotiated the settlement after a federal court in Miami ordered DirecTV last month to cut off network programming to hundreds of thousands of its customers.
Under the agreement, DirecTV customers living in areas close to local TV stations, called grade A areas, will regain the shows turned off starting last week only until June 30. But DirecTV will subsidize the purchase of antennas to help those customers get better over-the-air reception.
Customers living farther away from TV stations, in so-called grade B areas, will regain the network shows until Dec. 31 and then will also be able to buy subsidized antennas.
People who live very far from stations in so-called white areas were not affected by the Miami court order and will see no disruption in network programming.
Although the federal lawsuit was brought only by CBS Corp. and News Corp.'s Fox, the agreement will also cover network channels of Walt Disney Co.'s ABC and General Electric Co.'s NBC. Broadcasters said they would also seek to have the terms imposed by court on other satellite firms like Echostar Communications Corp.
Broadcasters brought the lawsuit because DirecTV, originally through an arrangement with another company, was sending customers nationwide network shows from just a few stations located in major cities.
The broadcasters complained that the transmissions reduced the ratings and ad revenues of hundreds of local affiliates and violated a 1988 law that said satellites could only send "distant" network signals to people living outside of grade A and B areas.
But many satellite customers complain that the law's standards are inadequate and that they cannot receive acceptable over-the-air reception despite living close to their local television stations.
Friday's agreement defused a looming confrontation in Congress, where lawmakers have struggled to overhaul the 1988 law called the Satellite Home Viewer Act.
The agreement of how to treat existing customers found to be illegally receiving network signals removed the most difficult and controversial issue from the congressional debate.
Most lawmakers agree that the current standard for distant signals should be maintained or perhaps tweaked, but that satellite services should be allowed to send local signals to customers in each of their local markets.
Shares of CBS were up $0.5625 to $36.9375 in morning trading on the New York Stock Exchange, while Hughes Electronics was unchanged at $48. |
