U.S. broadcasting companies CBS Corp and Dish Network Corp reached a multiyear deal on Saturday with CBS agreeing to continue to deliver its programs to Dish's 14 million subscribers.
The deal came hours after CBS pulled CBS, CBS Sports and Showtime from top Dish markets in the latest of a string of disputes between media conglomerates and distributors over the price of carrying cable channels and terms.
A CBS statement did not disclose the financial terms of the deal but said it will result in the dismissal of pending litigation between the companies.
There were a number of factors involved in the agreement including the price Dish pays CBS for each subscriber, the issue of digital rights and the number of networks wrapped up or “bundled” in the agreement, according to a source close to the deal.
Talks between Dish and CBS broke down after two extensions to their contract's initial Nov. 20 expiration, which had allowed them to continue their negotiations and keep the CBS channels available to Dish subscribers.
On Friday evening, CBS said it would no longer be available to Dish viewers in 17 major markets, including New York, Los Angeles, San Francisco and Denver, near Dish headquarters in Englewood, Colorado.
The stakes for such negotiating tactics are high and timing for the deal likely hinged on two huge sporting franchises that draw in millions of viewers. CBS broadcasts National Football League and the Southeastern Conference college football games. On Saturday, CBS airs the SEC championship game with the Alabama Crimson Tide and on Sunday it will carry the match-up between the Denver Broncos and the Buffalo Bills.
As part of the deal, Dish agreed to block use of its commercial-skipping AutoHop for new programs on CBS stations for a seven-day period. The deal also gives Dish rights to Showtime video-on-demand content but only within the home.
The AutoHopper has been a source of tension between Dish and major media companies like Walt Disney, Twenty-First Century Fox, and CBS, all of which launched lawsuits to try to prevent the satellite company from letting its customers skip commercials.
Earlier this year, Dish reached an agreement with Walt Disney to carry networks like ABC and ESPN after Dish said it would pull the commercial-skipping AutoHop feature for ABC shows. Disney agreed to drop its litigation against Dish.
Dish is also launching its own video streaming product, which will allow customers to watch TV programs, sporting events and other content through a broadband connection. It is not clear if Dish has signed any deals with major media companies. In the statement on Saturday both companies only indicated that there is a “path” to negotiate rights for streaming content but did not elaborate further.
Dish is also in extended talks with Time Warner Inc's Turner Broadcasting unit over program distribution rights.
This is not the first time that CBS has gone dark. In 2013, Time Warner Cable pulled CBS from its lineup for a month, affecting millions of viewers in major cities, including New York, Los Angeles and Dallas.