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BUSINESS: Dish Network and Viacom Reach Agreement

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posted on Mar, 11 2004 @ 11:24 AM
EchoStar (nasdaq: DISH) has reached an agreement with Viacom (nyse: VIAb) in the contract dispute that caused Dish Network to pull Viacom stations in 16 major U.S. cities. Viacom is the parent company for CBS, MTV, VH1, Nickelodeon, and Comedy Central. March 9, 2004, subscribers to Dish Network satellite service found that their usual programming on some channels were gone and they had to pull out the rabbit ears if they wanted to watch a local CBS station. The dispute only lasted 36 hours leaving customers with frustration, a Pay-Per-View coupon and a $1 rebate from Dish Network.
I am very pleased to announce that we’ve successfully reached a long-term agreement with Viacom to provide you with CBS and MTV Network channels including MTV, Comedy Central, and Nickelodeon. I am happy to say that this agreement will allow us to continue to provide you the lowest all-digital price everyday.
I understand that it has been a difficult 36 hours to be without these popular channels. We appreciate your patience, your support for DISH Network and your continued business.
As promised, you will receive a $1 credit on your next billing statement. In addition, we would like to thank you for all of your support by sending you a free DISH On Demand Pay-Per-View coupon that will allow you to view upcoming hits like “Cat in the Hat” and “School of Rock.” The coupon will arrive in your April billing statement. Enjoy a movie on us.
Charlie Ergen
DISH Network

Luckily the dispute did not carry on much longer. Many were concerned about missing their favorite college basketball team in action. March Madness, which starts March 18, is being carried by CBS this year. Rep. Fred Upton (R-Mich.), a member of the House Commerce Subcommittee on Telecommunications brought up the issue yesterday. “Let's cut to the chase and see if we can't come to an agreement, especially as March Madness begins.” Others were furious that their children were missing their favorite cartoons on Nickelodeon and tried to explain to their children why the station was off. Last night, Jon Stewart of Comedy Central’s Daily Show, said he wasn’t happy with the situation and would go door to door to deliver his show in person to those who were missing it.

The dispute was part of a contract negotiation in which Viacom stated that it wanted 6 cents more per subscriber, while EchoStar claims Viacom wanted far more compensation. The contract between the two companies had expired December 31, 2003 and had been extended at least 3 times. The details of the contract are unknown to anyone outside the two companies.

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