AT&T Inc said AMC Networks is seeking an "excessive rate increase" to renew its U-verse TV contract, which the mobile service provider believes is unreasonable.
"AMC Networks is asking that AT&T pay nearly double what we believe other competitors pay - including a smaller-sized competitor," the company said in a statement late on Wednesday.
AT&T's U-verse provides TV, Internet, and digital home phone services to about 4 million customers, and the company pays fees to AMC Networks for the right to package and sell the AMC, IFC and WE tv channels on the service. The contract ends on June 30.
The company believes the rates are disproportionate compared to the viewership across the channels.
"We don't think that's (rates) reasonable, especially in these economic times, and we will continue to work toward a fair deal," the second-biggest U.S. mobile service provider said.
In May, satellite TV provider Dish Networks announced its intent to discontinue carrying AMC's networks following a legal dispute between the companies stemming from a breach of contract.
AMC, which airs the "Mad Men" and "Walking Dead" series, sued Dish Network Corp for $2.5 billion in damages alleging improper termination of a 15-year contract with one of AMC's units called VOOM HD.
(Reporting by Balaji Sridharan and Siddharth Cavale in Bangalore; Editing by Chris Gallagher)