Viacom, 60 Cable Firms Part Ways in Rural US

For roughly two months, about 900,000 households in small towns across the US haven't been able to watch Nickelodeon, MTV or Comedy Central, as a result of a blackout of the Viacom-owned channels by some 60 small cable operators. So far, there is little evidence any more than a handful of the households care.

After bracing to lose as many as a 10th of their customers, the operators have lost less than 2% of their collective subscribers, according to an industry group that represents the operators.

Viacom isn't worried either, saying it expects "no financial impact" from losing what is only about 1% of total pay-TV households. As a result, with the cable operators unhappy about the price Viacom wants for the right to carry the channels, executives say the blackout is likely to be permanent.

Several have replaced the Viacom channels with others.

The situation signals a shift in the often-tense relations between pay-TV operators and entertainment companies. With video choices increasing, operators are starting to push back at program cost increases by dropping channels altogether.

The markets in the current dispute are mostly rural and suburban, in states including Oklahoma, Minnesota, Iowa and Idaho, where Viacom's portfolio of young-skewing channels with edgy programming popular in urban centers may not carry as much sway.