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Popular Viacom channels, including MTV, Comedy Central, Nickelodeon and more, have been dropped from the DirecTV network after negotiations broke down over a contract renewal.

Neither company is looking very good as they each try to control the narrative and paint one another in a negative light. How could these companies be so insensitive that they would choose to seperate viewers from the programs they love?

DirecTV has taken a very serious tone, portraying itself as fighting back to protect customers against an unreasonable price increase. Derek Chang, DIRECTV executive vice president of Content, Strategy and Development, said:

We have been very willing to get a deal done, but Viacom is pushing DIRECTV customers to pay more than a 30 percent increase, which equates to an extra $1 billion, despite the fact that the ratings for many of their main networks have plummeted and much of Viacom’s programming can be seen for free online. 

Viacom sent us a letter last night that outlined our obligations to remove the channels by midnight or face legal action just as they were falsely telling viewers DIRECTV was responsible. Let’s be clear, Viacom took these channels away from DIRECTV viewers.

Note how the language in this press release positions Viacom as the aggressor, and sets up the logic that every percentage of a vendor price increase for DirecTV will be automatically passed along to consumers. (As Adweek pointed out, "does DirecTV really have to raise your monthly bill? Couldn't a company that made $27.2 billion last year alone absorb some of the cost itself?") It also reveals the company's displeasure with Viacom making its programming available for online viewing.

Both companies have taken to Twitter and Facebook, as well as created microsites to address the brouhaha. DirecTV has an enormous advantage in social media: 1.4m Facebook likes and 66k Twitter followers, compared to Viacom's audiences of 3,300 on Facebook and and 7,100 on Twitter.

DirecTV has named their microsite "DirecTVpromise," and defaulted to the textbook corporate stolidness that emphasizes reliability, trustworthyness, value, and customer protection. This approach targets customers as though they were logical, rational beings, which helps them to feel back in control.

Unfortunately the video message from DirecTV's CEO is not on YouTube, and isn't embedable on site. Viacom was happy to oblige, with their own particularly charismatic interpretation that leveraged the format of the VH1 show "Pop-up Video"... EDIT: it appears as though Viacom is attempting to remove this video from the net - there are obvious copyright problems, but also, maybe mocking DirecTV's CEO is a bit much?

Viacom as a brand hasn't had much of a direct relationship with consumers, and has lead it's messaging with a hip, funny, and sarcastic voice that leverages it's beloved programming. In effect, Viacom is giving people what they want: their favorite characters.

It certainly doesn't hurt the company to have such charming assets at it's disposal. Is this sort of emotional appeal more powerful than DirecTV's somewhat paternalistic posture? 

One of the more prevalent complaints on Twitter is from parents who are frustrated to lose Nickelodeon while their children are at home on summer vacation. In this light, is highlighting the missing characters actually the best way to go, or does it just increase irritation? 

It's unlikely that this argument will drag out for too much longer. Who will "win" it? Other analysts have suggested that it's likely Viacom will receive some percentage of the increase it's asking for, but really, everyone's a loser here. 

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Published 13 July, 2012 by Sam Dwyer

Sam Dwyer is an Analyst based in Econsultancy's New York office. He can be followed on Twitter @sammydwyer.

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