Since Jan. 1, the televisions of Time Warner Cable customers have lost their Magic. Viewers no longer feel the Heat. Their screens don’t show the strikes of Lightning. Customers would also be hard pressed to find a Gator, Seminole, Panther or Knight coming into their living rooms.
The Sunshine Network, which has for 10 years brought the Tampa Bay Lightning, Orlando Magic and other professional and college teams to Time Warner customers, did not renew its contract with the cable provider. The Sunshine feed to Time Warner ceased on New Year’s, and has yet to resume.
Now, two weeks since the blackout began, nothing between the two companies has been resolved. In fact, the entire discussion seems to have devolved into accusations and finger pointing.
Time Warner says the reason the contract was not renewed was that Sunshine “demanded” an “extreme rate increase.” The number, according the company’s Web site, was in the neighborhood of 60 percent, with double-digit increases in subsequent years.
Cathy Weeden, general manager for Sunshine, said the proof that its rates are reasonable comes from the fact that Time Warner is the only provider with whom it has had a dispute.
“I think (Time Warner’s release) is a bit misleading,” Weeden said. “(Sunshine is) well below market value. I think that what we’re offering is very fair, and that is underscored by the fact that other operators in the state have signed on with us.”
Weeden said Time Warner was one of Sunshine’s owners when the previous contract was negotiated in 1992. The original package, a Sunshine representative said, had very little major programming, centering mainly on the Magic. Therefore, as programming has increased, Sunshine argues that it is not unreasonable to expect a certain level of price increase.
Weeden said Time Warner’s rate increase to its customers is “almost twice” what Sunshine has implemented in the Tampa market.
Linda Chambers, vice president of business affairs for Time Warner, has a different view of the situation.
“We didn’t drop them, they dropped us because we wouldn’t agree to their extreme rate increase they wanted to charge us,” Chambers said. “They de-authorized the signal to us.”
At this point, Chambers said, Time Warner is offering rebates for the programming cost as long as Sunshine is out.
Chambers, who said she was a 20-year Time Warner veteran, said normally when a contract expires and an agreement cannot be reached, the two sides agree to continue service. She said she was surprised at Sunshine’s actions.
“I have never seen a programming network pull its programming from our company,” Chambers said. “It makes me wonder how much they really care about the viewers.”
But it is those viewers who may be the wild card in forcing the sides to the bargaining table. Chambers said it is Sunshine’s goal to turn viewers against Time Warner.
“Their motivation is exactly to put the pressure on Time Warner by angering sports fans,” she said.
Chambers said she has not heard complaints from customers.
“The consumer research we’ve done really shows that our customers understand that this increase (Sunshine) asked for is unfair,” Chambers said. “(The response has been) positive because of Sunshine’s heavy-handed tactics.”
Weeden, on the other hand, said Sunshine received feedback supporting the station’s stance. She said the public she has heard from is calling for Time Warner to relent, though it seems to be falling on deaf ears.
“It’s unfortunate for everyone involved,” Weeden said.
But not everyone seems to think the situation is so unfortunate. Companies that are benefiting the most from the dispute are alternate cable and satellite providers that still carry Sunshine.
Robert Mercer, director for public relations for the satellite provider DirecTV, which carries Sunshine, said his company is now seeing an open door to take away Time Warner customers.
We certainly see this as an opportunity to remind customers as to why they want to consider DirecTV as an alternate,” Mercer said.
DirecTV made a big push during the Tampa Bay Buccaneers’ NFC division playoff victory Sunday. Two airplanes flew above Raymond James Stadium, one directly behind the other. The first pulled behind it the Sunshine Network logo. The second plane told fans that to see that network, they would have to call DirecTV.
Mercer said such advertising has not been unusual for DirecTV.
“We’ve run similar campaigns and quite successful campaigns,” Mercer said.
In addition to gimmicks like the airplane ad, Mercer said the company has started a television campaign to educate consumers on the alternatives to Time Warner.
“It tends to remind customers about why they were mad at the cable companies,” Mercer said.
Neither side will discuss how much money they stand to lose in the current dispute. But Time Warner, on a national scale, has suffered since its merger with AOL. The downturn has affected the company to the point where chairman Steve Chase offered his resignation, effective in May.
Both sides in the Florida dispute say they want to find a solution quickly, but both say the other is not working hard to that end. Chambers said she is hopeful for a solution.
“Absolutely, I think we’re definitely continuing negotiating, and talks are ongoing,” Chambers said. “There is a good possibility it would be solved.”
Weeden, however, questions Time Warner’s commitment to a solution.
“That is not the case; they are not negotiating,” Weeden said. “We have not heard any new proposal since Jan. 1. …They’ve dug in their heels, and they have not budged.”