* Cablevision CEO says Disney tactics "bullying"
* Says talks with Disney only began in earnest recently
(Adds source says $40 million, said to be sought by ABC, is
By Paul Thomasch
NEW YORK, March 2 Cablevision Systems Corp
CVC.N Chief Executive Jim Dolan blasted Walt Disney Co's
(DIS.N) "bullying" threat to pull ABC from its cable systems
over a contract dispute, calling the move senseless and one
that invites questions from U.S. regulators.
In his first public remarks about the intensifying fight,
Dolan said, "Fundamental to this issue right now is our
subscribers, our customers, should not have to pay for
something others are getting for free."
Dolan said discussions between the two sides only began in
earnest several weeks ago, disputing Disney's statement that
little progress has been made during some two years of talks.
"The idea that they are going to pull their signal .... I
don't think that that's good business. I think that it invites
scrutiny from the governmental side and, to be honest, I don't
really understand it because we're negotiating," Dolan said on
Tuesday at a Morgan Stanley conference in San Francisco.
"I would have thought they would have taken a more
diplomatic stance," he added.
Dolan's comments come in response Disney's announcement
that ABC has begun running on-air messages to Cablevision
subscribers warning them they may no longer have access to the
network from Sunday, March 7.
Cablevision on Monday said ABC was threatening to remove
the network unless Cablevision and its customers pay $40
million in new fees for programming that it offers for free.
A source familiar with the matter on Tuesday said the $40
million was an overstatement by Cablevision, and that
negotiations between the two companies were ongoing.
ABC's shows include "Lost," "Grey's Anatomy" and "Desperate
Housewives" as well as news programs like "Good Morning
America." ABC is also carrying the Academy Awards on Sunday,
often one of the most highly rated TV programs of the year.
The Disney-Cablevision dispute follows several other
high-profile contract battles between broadcasters and cable
providers. Both sides are showing far more concern about fees
-- partly due to the bad economy -- and a willingness to take
extreme measures to make the point.
At the heart of the issue is a disagreement over how much a
broadcast network should be paid by a cable distributor to
deliver free-to-air programs to their subscribers.
Fox, owned by News Corp (NWSA.O), and Time Warner Cable Inc
TWC.N, which had similarly disagreed over how much the cable
service provider should pay for the right to carry the network,
reached a deal on Jan. 1 to avoid a blackout after months of
(Reporting by Paul Thomasch; Editing by Richard Chang, Gary