On New Year’s Day in 2013, KOMO TV went dark for customers of Tacoma’s Click Cable TV.
The ABC affiliate remained off the air for 31 days while its corporate owners negotiated for higher fees from the city-owned cable system. To compensate for missed episodes of Grey’s Anatomy, The Bachelor and Modern Family, Click gave customers bill credits totaling $37,860 in all.
But KOMO’s corporate owner also got paid for the days it withheld the signal — $31,843.50, according to a city invoice.
That was no mistake, said Click General Manager Tenzin Gyaltsen in an email through a spokesperson. He said the contract negotiated with KOMO’s owner during the blackout called for Click to pay for all of 2013 — and at the new contract’s higher rates.
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That contract — which Tacoma released to The News Tribune after a nearly two-year court fight — awarded a 73 percent increase in the fees paid for two of Fisher Communications’ stations, KOMO and Univision.
At the time of the blackout, Click executives complained to the Tacoma City Council, which chastised the Seattle broadcaster for its strong-arm tactics. Click officials now say they had no choice but to acquiesce to Fisher’s demands.
“The broadcasters do have the power when it comes to negotiations like this because that’s the condition of getting the contract from them,” said Chris Gleason, a spokeswoman for Tacoma Public Utilities, which operates Click.
Bruce Beard, an attorney in St. Louis who has negotiated more than 400 retransmission consent agreements, said he’s not personally aware of any cable system that has been forced to pay during a station blackout. But that could be because other attorneys don’t talk about such clauses in contracts, which include confidentiality agreements, he said.
Broadcasters can force the hand of small cable systems like Click, he said.
“Does the cable operator pay for the entire year like (the broadcaster) demands? Or do they not carry the signal?” Beard said.
Gleason said that Gyaltsen himself has been involved in several contracts in which cable systems paid broadcasters during blackouts to resolve contract disputes.
Before Tacoma, Gyaltsen worked for the city of San Bruno, California, which also operates a small municipal cable system. Through Gleason, he said the city of San Bruno had to pay a broadcaster for a full year, even though a broadcaster withheld its signal for six months.
Dennis Wharton, spokesman for the National Association of Broadcasters, said broadcasters do have incentive to end contract disputes and negotiate with cable operators.
A broadcaster’s advertisers might pay less money if the station reaches fewer viewers, he explained.
“You want to have as many eyeballs as possible watching advertising-supported programming,” he said.
Before 2009, KOMO didn’t charge Click anything to rebroadcast its signal. Records show that by 2012, Fisher Communications was charging Click 82 cents per subscriber per month for two of its channels: KOMO and Univision. Its 2013 rate skyrocketed to $1.42 per subscriber.
A call to Sinclair Broadcast Group in Maryland, the new corporate owner of KOMO, was not returned.
As Click’s expenses rise, so do the rates customers pay. Click administrators have predicted a 10 percent increase in the overall Click cable bill in each of the next two years, much of it is due to rising programming fees.
Click operates in most of Tacoma and some areas in Pierce County. It also competes with with corporate giant Comcast for cable customers.
Within Click’s service area, Click and Comcast customers pay $52.99 for comparable 88-channel packages. But outside of Click’s service area, Comcast customers pay 24 percent more for the same service — $69.49 per month.