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ABC and Cablevision at a Standoff

Walt Disney's ABC and Cablevision Systems are battling over fees, and now Cablevision subscribers in the tri-state area may not get to watch the Oscars on Friday night.

CNBC.com

This follows an ongoing negotiation of retransmission fees where Disney is seeking an additional $40 million a year in new fees. The impasse may see its ABC station go dark after midnight this Saturday in parts of the New York metropolitan area.

WABC-TV started running ads on Monday evening alerting subscribers of this conflict, saying that the network has tried to negotiate compensation for WABC for the past two years. The network points out that Cablevision charges customers up to $18 each month for basic broadcast, sharing none of that with WABC-TV.

This is just the latest public battle over compensation for broadcast channels. Just before New Year's Eve in 2009, News Corp threatened to pull its Fox channels off Time Warner Cable, which would have left many subscribers without the Super Bowl. News Corp managed to negotiate compensation for Fox, as CBS had managed to negotiate retransmission fees for its broadcast channels over the past few years.

Cablevision isn't afraid to pull channels: for three weeks in January about three million Cablevision subscribers in New York New Jersey and Connecticut lost Food Network and HGTV. Scripps , the parent of those two popular channels and Cablevision were locked in conflict about compensation deals.

We'll see if this conflict comes to that.

ABC is certainly picking a prime time to get serious about negotiations. You can be sure early every one of those three million or so Cablevision subscribers wants to watch the Oscars.

A source close to negotiations said Cablevision pays ABC $200 million a year and that WABC is demanding a 20 percent increase.

Charles Schueler, Executive Vice President, Communications and Community Relations, Cablevision Systems Corp., issued the following statement on ABC Disney:

“It is shocking that in these difficult economic times, ABC Disney is threatening to remove WABC unless Cablevision and its customers pay $40 million in new fees for programming that it offers today for free, both over-the-air and online. It is not fair for ABC Disney to hold Cablevision customers hostage by forcing them to pay what amounts to a new TV tax. We urge ABC Disney not to pull the plug and instead work with us to reach a fair agreement.”

WABC-TV's President & General Manager Rebecca S. Campbell, released this statement:

“With the help of our viewers, we’ve built ABC7 into the most watched station in the country, and have been trying for two years to get Cablevision to acknowledge the station’s value to their business. Despite our best efforts, it has now become clear that Cablevision has no intention of coming to a fair agreement. We can no longer sit back and allow Cablevision to use our shows for free while they continue to charge their customers for them. We’ve worked too hard and invested too many millions of dollars in programming and community outreach, to be taken advantage of any longer – especially since our viewers can watch their favorite ABC7 shows free, over-the-air, or by switching to one of Cablevision’s competitors.”

ABC is also informing customers how to voice concerns or get ABC7's free over- the-air on www.saveABC7.com.

Questions? Comments? MediaMoney@cnbc.com

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  • Working from Los Angeles, Boorstin is CNBC's media and entertainment reporter and editor of CNBC.com's Media Money section.