WASHINGTON - Stymied by extended stonewalling by Cablevision Systems Corp. and its wholly-owned subsidiary Rainbow Media Holdings, Verizon has filed a formal program access complaint with the Federal Communications Commission to secure Rainbow's sports programming for Verizon's FiOS TV customers in New York and New England.
For more than a year, despite repeated requests to negotiate by Verizon, Rainbow has refused to begin to negotiate a carriage agreement for Fox Sports Network New York, Fox Sports Network New England and Madison Square Garden Network - all controlled by Rainbow.
Through Rainbow Media Holdings, Cablevision operates regional sports networks in New York that hold rights to produce and show games of local teams including the New York Knicks, New York Rangers, New York Islanders and the New Jersey Devils.
Rainbow also operates and owns a 50 percent interest in a regional sports network that holds rights to produce and show games of the Boston Celtics, among other teams in the Boston area.
"We are troubled by Cablevision/Rainbow's anti-competitive behavior and refusal to negotiate carriage agreements for their sports programming," said Terry Denson, Verizon vice president - FiOS TV content strategy & acquisition.
Denson said that Cablevision and Rainbow have been throwing up roadblocks ever since Verizon initiated discussions in the middle of 2004, and they have failed to even offer terms, despite Verizon's repeated requests to negotiate. Instead of negotiating provisions of the programming, Cablevision and Rainbow have sought details of Verizon's video deployment plans - information only valuable to Cablevision in its capacity as the only cable company in many areas where Verizon seeks to provide competition.
"Cablevision's consistent refusal to negotiate carriage terms clearly is an attempt to block competition and preserve its market position," Denson said, "and the 1992 Cable Act specifically prohibits this type of refusal to deal."
Verizon currently offers FiOS TV - video service over fiber-optic networks - in communities in seven states, including Massapequa Park, Nyack and South Nyack in New York; and Reading and Woburn in Massachusetts. The company is completing network upgrades and seeking franchises in more than a hundred additional New York communities, and Cablevision is the incumbent cable operator in the vast majority of them. Verizon is also seeking franchises in dozens of Massachusetts communities.
Verizon Communications Inc. (NYSE:VZ), a Dow 30 company, is a leader in delivering broadband and other communication innovations to wireline and wireless customers. Verizon operates America's most reliable wireless network, serving 51.3 million customers nationwide; one of the most expansive wholly-owned global IP networks; and one of the nation's premier wireline networks, serving home, business and wholesale customers. Based in New York, Verizon has a diverse workforce of approximately 250,000 and generates annual consolidated operating revenues of approximately $90 billion. For more information, visit www.verizon.com.