By Liana B. Baker
(Reuters) - Dish Network Corp has approached media companies, including Viacom Inc, about acquiring content for an Internet-based television service that would play live channels, according to a source familiar with the matter.
Dish and Viacom have been in talks about a deal for about a year after Dish first approached the company about a potential TV service. But while talks are ongoing, the two companies are far from a deal, the source said.
"Dish is approaching all programmers with this and some folks are still hearing them out," the source added.
Several programmers were not interested in speaking with Dish about an Internet-based service because they pay for expensive rights to broadcast live sports.
"Another reason why other programmers may have definitively turned this down is that they program live sports, so this model is a non-starter for them," the source said.
Dish already runs an Internet streaming subscription service under its Blockbuster brand. But that service is so far only available to Dish subscribers and it focuses on movies on demand and not live TV.
Dish sister company EchoStar Corp owns Sling Media, a company that makes a device that allows viewers to stream live TV over the Internet tied to a regular TV.
Bloomberg, which was first to report the news on Thursday, said Dish is also speaking to Scripps Networks Interactive Inc, which owns the cable networks "HGTV" and "Food Network," and the Spanish-language network Univision. The Web TV service has been in the works for some time. The Wall Street Journal reported on it last November.
Spokesmen for Viacom, Univision and Scripps declined to comment, while a Dish Network spokesman did not respond to a request for comment on Thursday.
A new service by Dish could shake up the pay TV industry, which relies on programmers striking expensive deals to carry a bundle of networks at a time.
Dish Chairman Charlie Ergen has been one of the most vocal critics of high programming costs and has said that cable and satellite operators should pay less for programs available on Internet services such as Netflix Inc or Apple Inc's iTunes.
The second-largest U.S. satellite TV company has also been exploring ways to diversify. It is awaiting a decision from the U.S. Federal Communications Commission about whether it can use the wireless spectrum it acquired to launch a mobile network.
Viacom was dropped by Dish's main rival, DirecTV, over the summer in a bitter dispute that left more than 20 million people without Viacom channels such as Nickelodeon for more than a week.
Dish shares were 54 cents, or 1.8 percent higher, at $30.95 in late afternoon trading.
(Reporting By Liana B. Baker; Additional reporting by Lisa Richwine)