Time Warner and MSG in Stalemate: New York Sports Fans Pay the Price

Time Warner Cable (NYSE:TWC) and Madison Square Garden (NASDAQ:MSG) were unable to reach an agreement before the deadline, meaning that MSG sporting events will not be aired in the coming year. The two sides were unable to agree on programming costs, which will result in the loss of New York Knicks and Rangers games for cable subscribers.

MarketWatch quoted Michael Blair, president of MSG Media in a New Year’s Eve press release which read, “We are disappointed that MSG and MSG Plus will be dropped from Time Warner Cable’s lineup.  All we have asked is for Time Warner Cable to value our programming in the same way as other TV providers–nothing more, nothing less. Unfortunately, they rejected every offer we made to them for almost two years.”

Time Warner countered with a statement which said, “The decision to remove their programming from our lineup rests entirely with MSG. By making that decision well in advance of the deadline, MSG has again shown that they are more interested in holding New York sports fans hostage than in negotiating a deal.”

Content costs have been an emerging issue, particularly in the sports genre.  While content owners have steadily demanded increased premiums, providers have at the same time been pressured to reduce their costs in order to compete with others in the cable, satellite and telecommunications industry.