Comcast Corp.’s  (CMCSA) NBCUniversal may go dark for 16 million cable customers of Charter Communications Inc. (CHTR) if a dispute over fees isn’t resolved.

NBCUniversal’s deal with Charter’s cable service Spectrum expires at the end of the month, which means millions of customers could lose access to “Sunday Night Football,” MSNBC, CNBC, Telemundo, Bravo, E!, USA Network, Syfy, and Oxygen.

Bad Timing for Key Customers

Los Angles and New York are Charter’s two largest markets, with the blackout potentially affecting 1 million customers in New York alone. And it comes at a bad time for sports and entertainment viewers since January is a big month for NBC in terms sports games and awards shows. It doesn’t help that a handful of NBC shows are scheduled to resume in the beginning of January, as well as the Golden Globe Awards and returns of major shows on the other NBCUniversal channels.

"Charter Spectrum has been unyielding in its demand for terms superior to those agreed to by the rest of the industry, including larger distributors," NBCU said in a statement, according to media reports. "Given this position, we feel the responsibility to inform viewers that Charter Spectrum may drop NBCUniversal's networks at the end of the year, including NBC, Telemundo, USA, Bravo and hit shows including the #1 show on TV—Sunday Night Football, WWE, the Golden Globes, This Is Us and more." 

Ever since Charter acquired Time Warner Cable in the spring, the cable operator has been trying to get better deals from content providers and programmers. In July, Fox News sued the second-largest cable operator contending it breached its contract by trying to apply Time Warner Cable’s channel carriage rates and isn’t abiding by an agreement Charter signed with Fox to distribute Fox News Channel and Fox Business Network. Charter spent $55.1 billion to acquire Time Warner Cable and $10.4 billion to buy Bright House Networks, creating its new cable service Spectrum. (See also: Charter-Time Warner Cable Merger Wins Approval.)

NBCUniversal to Have Strong 2017

The fight with Charter comes at a time when Wall Street is optimistic about Comcast’s prospects for 2017, thanks in large part to NBCUniversal. In a recent research report, Jefferies analyst Mike McCormack raised his price target on Comcast to $80 a share from $77.

Behind the enthusiasm for the cable operator: a full slate of films out of Universal next year and overstated fears over customers cutting the cord on cable. Excluding the Olympics, McCormack is forecasting revenue growth of 5.9% for NBCUniversal in 2017, which is up from 1.4% this year. Next year will be the first full year in which DreamWorks Animation is included in revenue. NBCUniversal acquired DreamWorks in August for $3.8 billion. In addition to that, 2017 will bring franchise sequels for “Fast & Furious,” “Despicable Me” and “Fifty Shades of Grey,” all of which should surpass $100 million in box-office sales, the analyst said. (See also: Comcast Sees a Good 2017 Thanks to NBCUniversal.)



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