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Time Warner cable pulls ABC stations in fee dispute
NEW YORK (CNN) -- Time Warner and ABC were blaming each other Monday for the cable company's decision to pull the plug on ABC's owned and operated stations in a dispute over fees.
About 3.5 million cable homes were affected by the Time Warner removal of seven Disney-owned ABC stations, including stations broadcasting to New York City, portions of the Los Angeles area, Houston, Flint, Michigan, Raleigh-Durham, North Carolina, Fresno, California, Toledo, Ohio and Philadelphia.
Time Warner -- which is a sister company to CNN.com, a Time Warner Inc. property -- charged that the disruption was the fault of the Walt Disney Company, which owns ABC.
"Disney is trying to inappropriately use its ownership of ABC to extract excessive and unreasonable terms for its cable channels -- terms that would add hundreds of millions of dollars in costs for Time Warner Communications and its cable customers," read a message from Time Warner to its Los Angeles subscribers.
"This is a punitive act, but Time Warner is punishing their own customers," said Arnold Kleiner, president and general manager of KABC in Los Angeles. "This blackout is a frightening foreshadowing of the implications of the Time Warner-AOL (America Online) merger."
The ABC signals were still on the air, and available to viewers who used rabbit ears with their televisions.
Time Warner said it had no signed agreement allowing it to continue to carry the ABC signals. ABC said it had given Time Warner permission on April 26 to continue to carry the stations.
An ABC spokeswoman told CNN, "ABC has given Time Warner Cable complete and unconditional authority to carry a signal until May 24th."
Dispute comes during key May sweeps
The dispute comes at a critical time for the ABC network, which is entering the critical May sweeps period, which helps determine what prices networks can charge advertisers in the coming months.
The spokeswoman said Time Warner is in violation of an FCC ruling that stations cannoot be dropped during a ratings "sweeps" period. She said ABC is petitioning the FCC for an order to force Time Warner to put the stations back on its systems.
In the next weeks, ABC is set to air four celebrity editions of "Who Wants to be a Millionaire," the conclusion of its miniseries "Arabian Nights," the Daytime Emmys, Saturday's Kentucky Derby and virtually all of its prime-time season finales. The first celebrity "Millionaire" airs Monday night.
In Washington, the FCC was reviewing Disney's appeal, a spokeswoman said. Representatives from both companies were meeting with FCC officials to discuss their positions.
Time Warner's contract to carry ABC's stations officially ended December 31, 1999, but negotiations to renew that agreement continually stalled over how much Time Warner should pay to carry ABC's programming, as allowed under the 1992 Cable TV Act.
Disney also wanted Time Warner to offer some of its other networks, including the new Toon Disney and the Soap Network. Disney also wanted The Disney Channel, as part of its basic programming instead of paid premium channels.
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Time Warner Inc.
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