Viacom has signed a new long-term deal with AT&T U-Verse and DirecTV distribution platforms.
Terms of the deal were not disclosed, but in an unusual statement, AT&T noted that given its status as the largest pay-TV provider in the world, “this agreement entitles AT&T’s satellite and IPTV platforms to the best deal in the industry for Viacom’s leading portfolio of television brands.”
The statement confirms concerns that consolidation on the distribution side of the business will make it tougher for programmers. By the time the agreement ends, AT&T is expected to be paying DirecTV’s lower rates for U-Verse subs. Under the terms of DirecTV’s current deal with Viacom, those rates will have escalated by the time the two become aligned.
Without major must-have sports programming, Viacom has been considered to have less leverage than other programmers in being able to get sub fee increases as distribution deals expire.
But this is the third big deal Viacom has been able to complete over the past five months, following agreements with Mediacom and Charter Communications. Both deals were completed without a blackout of consumers.
Viacom’s stock has been under pressure as investors await the outcome of negotiations for a new distribution deal with Dish Network. The current Dish deal expires next year.
The company has also been under ratings pressure and has shaken up its management ranks over the course of the past year.
Most recently, it named a new head at its MTV network, former Discovery executive Sean Atkins.
