I am writing on behalf of DIRECTV and in response to your letter, dated January 27, 2023, regarding the status of DIRECTV’s commercial relationship with Newsmax. We appreciate your concerns for the impact that this may have on New Yorkers and New York City.
Unfortunately, your letter includes several important mischaracterizations about our relationship with Newsmax. We assume that you have relied on representations from Newsmax, and we’d like to correct the factual inaccuracies.
Most importantly, in no way has DIRECTV “cancelled” or “silenced” Newsmax. Rather, ours is a business dispute, pure and simple. It is about economics and has nothing to do with ideology, politics or censorship.
The facts are:
- When DIRECTV’s prior agreement with Newsmax was set to expire, Newsmax advised us that it would extend our right to distribute the channel only if we agreed to pay tens of millions of dollars in licensing fees – a cost we would have to pass along to all of our customers. We did not agree.
- Newsmax seeks to change the model by which it commercializes its channel. To date, Newsmax has been an advertising-supported channel. To maximize ad sales it distributes the channel free of charge to the approximately 75 million US households that have a pay TV service as well as to the approximately 55 million US households that don’t and instead view the channel on Newsmax’s website or through services like Roku and Amazon Fire. Under its proposed new model, Newsmax plans to make its channel available exclusively in pay TV, to the detriment of the 55 million households that don’t have a pay TV service, and to start charging pay TV operators a per subscriber fee to distribute the channel.
- DIRECTV does not think that this new model is in the best interests of DIRECTV customers. Newsmax has insisted on its terms – as is its right to do – and we have insisted on ours. Lacking continued authorization to distribute Newsmax, DIRECTV it was forced to remove the channel from our lineup.
- The fact that Newsmax is no longer available on DIRECTV does not constitute “cancelling” or “silencing” of the channel. Newsmax continues to be available on most other major pay TV operators and is also available (including to DIRECTV subscribers) free of charge on Newsmax’s website and on platforms like Roku and Amazon Fire.
- Newsmax’s claims that DIRECTV is biased against conservative voices are untrue. Importantly, DIRECTV recently launched The First, a conservative news and commentary channel featuring Bill O’Reilly, Jesse Kelly, Liz Wheeler, and Dana Loesch, among others.
- DIRECTV carries five channels that most people would consider to be predominately news: Fox News, CNN, MSNBC, The First and NewsNation. By most people’s measure, two of these lean conservative (Fox News and The First), two lean liberal (CNN and MSNBC) and one is a newer channel that is advertising that it is news focused and in the center (NewsNation). FOX News is by far the leader in terms of audience and household penetration. Newsmax, when we distributed it, was a distant fourth to Fox, MSNBC and CNN among news networks.
While we appreciate your concern for New York City jobs, we also think that it is important to consider New York consumers. Why should DIRECTVs customers in New York City have to start paying more for a channel that they are used to viewing without charge, and can easily view anywhere online for no charge?
And what about the many New York City households that don’t currently have a pay TV subscription and will lose access to the channel under Newsmax’s proposed new commercial model? Ultimately, contracts require an agreement between parties. That’s what the free market is all about. We continue to be willing to negotiate with Newsmax in good faith, but believe it is our duty to protect our customers.
Carriage disputes are frustrating for all. Unfortunately, they have long been part of our industry. Just like other pay TV operators, we have in the past experienced outages with other content providers. Typically, they are temporary. After networks withdraw their content, we continue to negotiate, and the parties ultimately reach agreement. We hope this matter can be resolved in the same way.
Stay current with the Newsmax story and any other relevant issues facing DIRECTV customers at TVPromise.com.
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