Insiders say dispute over price, cablers feel economic pinch

Israel’s Satellite and Cable Council ruled Thursday that the country’s cable companies can pull CNN Intl. from their systems.

The regulatory agency’s verdict was the result of a request from three operators to drop CNNi while at the same time trying to resolve a contractual squabble with the cabler. CNNi’s deal with the ops ends Oct. 31, after which time the operators are free to drop the AOL Time Warner channel.

Inside sources at CNN indicated that the camps couldn’t agree on a carriage charge. Cable companies and satcasters in the Holy Land want CNNi’s price to drop, complaining that they are feeling the pinch of an economic downturn and that they’ve lost business to upstart satcaster YES, which has around 310,000 subscribers. Cable companies have 1.15 million subs.

Pricey posturing

CNNi views the petition as a negotiating posture to drive down the price.

“On the face of it, it would seem like the cable companies’ scapegoating of CNN and the attack campaign against CNN is continuing,” said Ron Ciccone, Turner senior veepee for the Middle East, hinting that criticism of the net’s content in this politically sensitive corner of the world is perhaps a distraction from the core issue.

“We have every concern that the Israeli public be properly served with responsible and objective reporting,” he said.

In its official notification, however, the regulator said that the network’s editorial content was not factored into its verdict.

Bias alleged

The cabler has frequently been accused of producing stories that show bias toward Palestinians in the Middle East conflict. When CNN founder Ted Turner (who takes no direct part in the company) publicly equated Palestinian terrorism and Israeli military actions, the Mouth of the South touched some sensitive nerves. Soon after, news exec Eason Jordan paid a visit to the country to smooth over the flap with government officials and cable guys.

Despite the verdict from the council, however, insiders at CNNi predict that negotiations with cable ops and satcasters will continue.

BBC, Sky News and most recent arrival Fox News are all alternatives to the AOL Time Warner company.

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