Dish CEO says talks to renew Viacom deal have turned productive

By Jessica Toonkel and Malathi Nayak

(Reuters) - Dish Network Corp (DISH.O) Chief Executive Charlie Ergen said on Wednesday that talks to renew the satellite TV provider's contract to carry Viacom Inc (VIAB.O) programs have turned positive, though a deal remains uncertain ahead of a midnight deadline.

"As a long-standing partner, we are hopeful that we can work together to reach a deal," Viacom responded in an emailed statement.

Viacom shares rose 1.5 percent on the comments, after falling more than 1 percent earlier on Wednesday. Dish shares were barely changed.

The companies have been in talks for several months over whether Dish would continue to carry Viacom's 18 channels and at what price. A blackout would block Dish's 14 million subscribers' access to Viacom shows such as "Broad City" on Comedy Central and "SpongeBob SquarePants" on Nickelodeon.

"Over the past 24 hours, hundreds of thousands of concerned subscribers have reached out to implore DISH to negotiate reasonable terms with Viacom for continued carriage of our networks," Viacom said.

"Based on year-to-date Nielsen data, our networks represent nearly one fifth of cable viewership on Dish, which gives Dish enormous incentive to renew our agreement."

Billionaire investor Mario Gabelli, who has the largest voting share in Viacom behind former Executive Chairman Sumner Redstone's family, told Reuters earlier on Wednesday that he expected a 10-day blackout after the current contract expires at midnight.

Dish had in recent months offered Viacom a rolling short-term extension and was "prepared to move on" without Viacom programming if no agreement is reached, Ergen told investors on a conference call after reporting quarterly earnings.

The talks have turned more productive since the weekend, he said.

The negotiations are being held as Dish tackles subscriber losses and Viacom tries to turn around sagging viewership ratings, as online video services such as Netflix Inc (NFLX.O) and Hulu have become more popular.

In an e-mail to Reuters, Gabelli said he hoped that once the contract is renewed, Viacom's management would turn its attention to selling a minority stake in its Paramount movie studio.

Dish, whose last distribution deal with Viacom was in 2009, declined to comment on Gabelli's comments.

Viacom on Tuesday warned Dish subscribers that they might soon lose access to its channels, including MTV, if no agreement is reached by the deadline.

Ergen, known to be a tough negotiator, has locked horns with big networks such as CBS Corp (CBS.N) and Time Warner Inc's (TWX.N) Turner Broadcasting on distribution deals.

Seventy-five percent of Dish's negotiations with content providers have led to temporary blackouts, according to a J.P. Morgan report published Tuesday.

(Reporting by Jessica Toonkel and Malathi Nayak; Editing by Meredith Mazzilli and Richard Chang)