January 2, 2009

Time Warner Cable subscribers did not see SpongeBob SquarePants and Jon Stewart vanish from their TV sets Wednesday night, thanks to a last-minute agreement between the cable company and Viacom. The deal came after the two sides had rancorous exchanges at the negotiating table and on television over Viacom's demand for an increase in carriage fees. At midnight, when the deal finally expired, they agreed to keep on talking, and finally, about an hour later, they reached an agreement (but did not make the terms public). Earlier in the day the American Cable Association demanded that Viacom stop running a "crawl" telling subscribers that they might lose their favorite programs because of the dispute. The ACA observed that only 16 million Time Warner Cable subscribers would be affected and that the announcement was likely to alarm the "82.9 million subscribers around the country that have nothing to do with that mess and are now concerned their service will soon be disrupted." Analysts generally agreed that whatever fees increase TimeWarner will now pay Viacom for retransmitting its programs will be passed on to subscribers.

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