AT&T, Rainbow Hash Out New Carriage Deal

After agreeing to continue to negotiate past an already extended deadline, Rainbow Media and AT&T U-verse on Thursday came to terms on a new carriage deal.

The two sides averted a standoff that would have led to a blackout of AMC, IFC, Sundance Channel and WE tv in some 2.3 million U-verse households.

Terms of the contract were not disclosed, although AT&T characterized it as a “fair deal…at prices that are in line with the marketplace.” For its part, Rainbow said the agreement “truly recognizes the value of our networks.”

As is generally the case with carriage disputes, pricing was the prime mover behind the AT&T-Rainbow dustup. Analysts estimate AMC’s sub fee at around 25 cents per customer per month, a number that puts the 26-year-old network in the same neighborhood as A&E and Lifetime.

AT&T also suggested that Rainbow’s push to get the operator to add WE tv spinoff Wedding Central to its lineup added a degree of difficulty to the negotiations. In the end, AT&T did not pick up the startup.

The original carriage deal expired on July 1, but AT&T and Rainbow agreed to keep the signals live as they continued to negotiate. A two-week extension was observed, and the drop-deadline (midnight, July 14) came and went without any interruption of service.

With the new agreement in hand, AT&T can guarantee fans of AMC’s Mad Men that they will be able to check in with the gang at Sterling Cooper Draper Pryce. Season four of the award-winning show premieres Sunday, July 25 at 10 p.m.

As of March 31, 2010, AMC boasted 88 million subscribers. As such, AT&T U-verse subs account for less than 3 percent of the network’s total head count. WE tv reaches 63 million subscribers, IFC is in 50.5 million homes and Sundance Channel serves 39 million subs, per Cablevision’s first quarter earnings.

While the final outcome kept AT&T U-verse from losing the four channels, a far greater conflict draws near, as Time Warner Cable and the Walt Disney Co. are presently locking horns over a renewal of a carriage deal that covers ABC, ESPN and The Disney Channel.

The deadline for both parties to come to terms is Sept. 2.