Oscar outrage: Some viewers faced dark screens due to ABC-Cablevision tiff

Enough is enough with making viewers pay the price when contract negotiations between networks and TV providers hit a tough patch.

So say our advocacy colleagues at Consumers Union (CU), the parent company for Consumer Reports, after many New York City-area Cablevision subscribers lost the ABC network for much of Sunday, including part of the Academy Awards broadcast. Shut off at midnight by ABC, service was restored some 14 minutes into the broadcast, after the companies announced they'd made progress in resolving their dispute over payments from the cable carrier to the network for carrying ABC.

As the broadcast approached, the FCC was reportedly in touch with the companies, and issued a statement Sunday saying that "consumers should not suffer due to the inability of these two companies to successfully negotiate a deal." Senator John Kerry, chairman of the Senate Communications Subcommittee, also weighed in, urging the companies to avoid making consumers suffer "collateral damage" from the dispute. 

Pressure from Washington likely helped prompt the companies to settle, as did a barrage of invective from viewers on forums and social media.

But given the serious outcome of this incident, CU says the FCC now needs to do more and earlier in such situations. Our advocates say that program access rules at the FCC should contain a better process to resolve such "carriage disputes" between cable companies and independent programmers. According to CU, the agency needs to develop guidelines with such tools, such as arbitration and a negotiation deadline, to ensure cable companies and content owners negotiate in good faith.

The Oscars fiasco surely won't last such dispute. Fox and Time Warner already went to the brink of a blackout in late December but settled their disagreement in the nick of time. In another case, Cablevision stopped running the Scripps' channels—Food Network and HGTV—for several weeks in January.

Most such disputes follow the same sorry pattern. After rumblings such as statements carried on cable-guide channels, the dispute breaks out into the likes of full-page ads in major newspapers—as with the dueling full-page ads in the Wall Street Journal late last week by ABC and Cablevision. Both sides invariably implore viewers to weigh in on a dispute whose complexities likely elude them, and where which side is at fault, and why, feels like none of their concern. Yet viewers are urged to act, in part because on side or the other threatens an interruption of service. 

With any luck, the PR fallout from the ABC-Cablevision clash will dissuade other companies from escalating such disputes so publicly and so intrusively. But I wouldn't bet on it. As channel owners seek to recoup revenues being lost by a declining advertising market and cable companies continue to raise rates with impunity, consumers are likely to see these disputes more frequently and they will only result in rising monthly costs. As our CU colleagues say, it may be time for greater regulatory muscle to combat the apparent dysfunction between TV providers and content providers.

—Paul Reynolds