Facing suits seeking franchise fee payments for its streaming service, DirecTV told the 8th U.S. Circuit Court of Appeals it agrees with a lower court's rejection of similar litigation against Netflix and Hulu. In a docket 21-3435 amicus brief Tuesday, DirecTV said the Arkansas Video Service Act, on which the city of Ashdown's suit relies, doesn't support the Arkansas community's claims against Netflix and Hulu. Ashdown, which didn't comment, is appealing the lower court decision (see 2112230003).

Acceding to political pressure and canceling carriage of conservative One America News (OAN) "sets a dangerous precedent" and DirecTV "should stand fast against such pressure to stifle dissenting and alternative opinions," the West Virginia and Ohio attorneys general wrote DirecTV CEO Bill Morrow Friday. "The Fourth Estate must have ample room to cover the government and politics of the day, without newsrooms constantly looking over their shoulder," Patrick Morrissey and Dave Yost said. The letter follows a similar one last week from six other Republican AGs (see 2203110025). OAN sued DirecTV, AT&T and its chairman, William Kennard, in San Diego County Superior Court last week, alleging breach of contract. OAN said it signed an advertising agreement with AT&T Services -- covering traditional advertising and programmatic targeted advertising -- that runs until 2024 on the assumption DirecTV would renew its carriage of the network beyond the 2022 expiration. It said AT&T also violated a nondisparagement clause in its carriage agreement with OAN when various WarnerMedia programs did coverage critical of OAN. AT&T said the allegations "are completely without merit, particularly as they relate to AT&T and our independent Chairman.” DirecTV said the lawsuit allegations "are baseless, and we are confident that we have fully complied with both the law and our agreement.”

The next semiannual disclosures by U.S.-based foreign media outlets are due April 12, said an FCC Media Bureau public notice Friday. The agency will transmit by May 8 a report to Congress that summarizes the submissions, the PN said.

DirecTV's decision to drop One America News from its lineup is "an unwise business decision" that masks "viewpoint discrimination with neutral corporate-speak," Texas Attorney General Ken Paxton and five other Republican state attorneys general said in a letter Thursday to DirecTV CEO Bill Morrow. Not reversing course means millions of subscriber cancellations, as President Donald "Trump and other leading figures have already called for," said Paxton. Louisiana's Jeff Landry, Mississippi's Lynn Fitch, Missouri's Eric Schmitt, Montana's Austin Knudsen and South Carolina's Alan Wilson co-signed the letter. DirecTV didn't comment Friday.

Discovery shareholders signed off on buying AT&T's WarnerMedia, Discovery said Friday. It said the approval was one of the last big hurdles, and the deal and creation of Warner Bros. Discovery should happen in Q2. The transaction was announced in May (see 2105160003).

SiriusXM signed a multiyear deal with reVolver that gives the SXM Media revenue organization exclusive global ad sales rights to reVolver's podcast lineup, said SiriusXM Thursday. The agreement also gives SiriusXM’s podcast subsidiary Stitcher authorization to distribute all reVolver content across all podcast platforms, it said. SiriusXM billed reVolver as the top multicultural audio-on-demand content creator and publisher in the U.S.

Netflix has no plans to introduce an ad-supported tier as Disney+ intends to do this year in the U.S. (see 2203080004), Chief Financial Officer Spencer Neumann told a Morgan Stanley investment conference Tuesday. “It's not like we have religion against advertising,” said Neumann. “We think we have a great model in the subscription business." Netflix will “never say never” to an ad-supported tier, he said. “It's hard for us to kind of ignore that others are doing it, but it now doesn't make sense for us.” Netflix hopes mobile gaming will be "a big part of our business in a decade," but "it's not going to be a big part of our business in the next 12 months," said the CFO. Netflix went from "saying we wanted to get in the games business to launching a games business globally inside of 12 months and having it work on Android and iOS and around the world," he said.

The Netflix “first-mover advantage” and its large subscriber base gives it a “nearly insurmountable competitive advantage” over streaming peers, Wedbush analyst Michael Pachter wrote investors Wednesday, upgrading shares to “neutral” from “underperform.” Netflix “appears to have hit a ceiling" on subscribers in the U.S. and Canada “and is pulling new levers to lower churn,” he said, citing a new season of the Russian Doll series in Q2 and the final season of Stranger Things scheduled to straddle Q2 and Q3. Subscription price increases will likely fuel added content production and growth in other regions, Pachter said. Future subscriber growth will occur mostly in less developed regions at much lower subscription prices, while subscribers in saturated markets pay higher rates to fund new content. Wedbush expects Netflix to deliver profit growth as long as it can continue raising subscription prices, “but competition may create a price ceiling.”

Arkansas' Video Service Act (VSA) doesn't apply to streaming services like Netflix and Hulu, and the U.S. District Court in Texarkana rightly threw out claims by the city of Ashdown that the streamers owe unpaid franchise fees, they told the 8th U.S. Circuit Court of Appeals in docket 21-3435 appellee answering briefs Tuesday. Ashdown is appealing a lower court's dismissal of its suit seeking franchise fees from the streamers (see 2202100004). The streamers said a growing number of courts reached similar conclusions about franchise fee suits brought under statutes they said were similar to the VSA, and made a similar argument Tuesday in federal court in New Jersey as they fight similar franchise fee litigation there. Hulu told the appellate court it doesn't install or build any facilities of its own in public rights of way and thus never sought a state certificate of franchise authority. It said its service predates the Arkansas VSA by five years, but there was no mention of it or other streaming services in the VSA's legislative history, and for years no state authority attempted to apply the law's requirements to it. Hulu said the VSA doesn't authorize a municipality suing a non-franchise holder for franchise fees. Netflix said subscribers access its content library over the public Internet, and therefore it doesn't need a franchise and has no obligation to pay franchise fees under the VSA. In a docket 2:21-cv-15303 filing Tuesday in U.S. District Court in Newark, the streamers cited a February decision by Gwinnett County, Georgia, Superior Court to bolster their argument for tossing out a pending suit by Longport and Irvington, New Jersey. The streamers said the Georgia court said Netflix content doesn't constitute video programming under Georgia law "that is substantially similar ot the New Jersey Cable Television Act." The Gwinnett County decision granted a Hulu, Netflix, Disney and Dish Network motion to dismiss litigation brought by several Georgia localities. Outside counsel for the Arkansas and New Jersey communities didn't comment.

Pay-TV providers controlling 93% of the market lost about 4.7 million net video subscribers last year vs. a pro forma net loss of about 4.9 million in 2020, reported Leichtman Research Group Tuesday. The loss of 2.7 million cable video subscribers in 2021 compared with an exodus of 1.9 million in the prior year, it said. Comcast shed 1.7 million subscribers to end 2021 with 18.2 million; Charter dropped 367,000 to end at 15.8 million, it said. Other traditional pay-TV services lost 2.9 million subs vs. a loss of 3.8 million in 2020. DirecTV lost 1.9 million to end with 14.6 million customers; Dish TV lost 595,000 to 8.2 million, and 282,000 left Verizon Fios, bringing its subscriber count to 3.6 million. Top vMVPDs added 895,000 subs last year vs. a gain of 915,000 in 2020, led by fuboTV, which added 581,000 subscribers to end the year with 1.1 million. Hulu+ Live TV remains the leading vMVPD, adding 300,000 subs for a total 4.3 million; Sling TV added 12,000 accounts for a total 2.5 million. The top seven cable companies have 41.3 million video subscribers; other traditional pay-TV services have 26.8 million and the top publicly reported vMVPD services have 7.9 million, it said.