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Just after midnight on Jan. 6, technicians in 12 mostly Midwestern states threw switches that blacked out at least one major broadcast channel from about 500,000 homes.

Behind the disruption was an increasingly bitter, high-stakes slugfest between broadcast-station owners and cableoperators. Sinclair Broadcast Group Inc. blacked out 22 of its 57 stations, and the popular network showsthey carry, from cableoperator Mediacom Communications Corp. Mediacom had refused Sinclair'snew demand to cablecompanies: Start handing over cash forits programs.

On Friday, with a blacked-out Super Bowl looming forsome customers, the battle was resolved in Sinclair'sfavor. After first refusing to buckle in what he called "a huge fight about principles," Mediacom'sCEO Rocco Commisso acknowledged his adversary got much of what it was asking. "I don't feel good about this," he said, as the stations began flicking back on.

All over the country, a shiftin the balance of powerbetween cableoperators and broadcasters has station owners -- including giants such as CBS Corp. -- lining up to demand new cash payments.

If forced to pay, cableoperators may have to raise prices or see their profits erode. The struggling broadcast networks such as CBS, on the other hand, would benefit from a major new revenue stream: cablepayments to the local stations that networks own.

Cablecompanies have been picking up broadcast stations' signals without paying cash almost since the birth of cable TVmore than 50 years ago. But broadcast stations are beginning to flex their muscles now. Cableoperators face growing competition from satellite operators and new TVventures by phone companies -- both of which payto retransmit broadcast signals. Meanwhile, local broadcast stations are seeking new income to make up forfalling ad revenue, as TVviewership of local programming falls and digital videorecorders such as TiVo let viewers skip ads.

Congress also has been tilting the playing field, gradually allowing broadcast companies to accumulate more stations and thus bargaining power. The Federal Communications Commission, which has locked horns with the cableindustry on numerous issues under Chairman Kevin Martin, issued a recent ruling supporting Sinclair'sposition, increasing the pressure on Mediacom and possibly other cableoperators to back down.

Based on the changing dynamics, Monterey, Calif., media research firm Kagan Research predicted last year that station owners will be able to collect almost $400 million in retransmission fees from cableby 2010 -- and $1 billion altogether including fees from phone and satellite operators, up from $230 million last year.

The fees some broadcast stations have been asking could drive cablebills up by around $2 a month. Some broadcasters already are talking about at least doubling that over the next few years, and retransmission fights have been breaking out all over the country.

Irving, Texas-based Nexstar Broadcasting Group Inc. broke the ice last year by getting about 16 cents a month per subscriber from cablecompanies, it said. Since December, Northwest Broadcasting Corp. has withheld the signal of its Spokane, Wash., Fox affiliate from a Time Warner Inc.-owned cablesystem, demanding cash. The CBS affiliate in New Orleans was about to go dark in the homes of cablegiant Cox Communications Inc. customers last week, but Cox and station owner Belo Corp. agreed to keep talking.

Sinclair is pushing even the biggest cableplayers, with the next showdown possible later this month: If it doesn't win cash from Comcast Corp., the country'sbiggest cableprovider with more than 23 million subscribers, by the end of February, Sinclair says it may shut down signals in about 30 markets. So far Comcast isn't budging: "We don't pay for free TV," says David Cohen, a Comcast executive vice president. In January, Sinclair settled with Time Warner Cable, the No. 2 operator, forwhat it called "a mutually acceptable economic agreement" to carry the signals of 35 of its stations. People familiar with the deal say there was payment but not on the per-subscriber basis Sinclair sought. A Time Warner Cablespokesman declined to comment.

The Sinclair-Mediacom battle pitted two scrappy chief executives known fornot shying away from a fight. Now it sets the biggest precedent yet forcash payouts. Neither side will disclose the exact terms, but people familiar with the negotiations say Sinclair was seeking about 40 to 50 cents per subscriber per month forits major broadcast stations.

Last July, Mr. Commisso, a former Bronx disco owner, called fora meeting with Sinclair Chief Executive David Smith, son of the broadcast company'sfounder, to resolve their differences "CEO to CEO." People at the meeting said Mr. Commisso warned Mr. Smith he wasn't easily intimidated, saying that in the rough neighborhood where he grew up, "I've had people hold a gun to my head and I've told them to pull the trigger." Mr. Smith wasn't intimidated either: He laughed out loud, say some people familiar with the meeting.

Sinclair ran an aggressive ad campaign pointing out, as the blackout approached, the showsthat Mediacom subscribers would be missing. In response, Mediacom handed out tens of thousands of "rabbit ear" antennas so their subscribers could pick up Sinclair stations the old- fashioned way.

The industry dispute has been building since cableentrepreneurs first began piping broadcast signals over wires to homes, offering better reception. Broadcasters almost immediately cried foul. Foryears the dispute wound through the courts and the FCC, with each side claiming rights to what'stransmitted on the open airwaves. While some decisions went against cable, operators foryears were able to retransmit broadcast signals without having to pay.

But in 1992, Congress weighed in solidly on the broadcasters' side. By that time most U.S. households were taking cableand cableoperators were competing with broadcasters foradvertising. With no competition from satellite TVat that time, lawmakers were concerned that cablewas getting too powerful and some broadcast stations, especially smaller ones, could be put out of business. As a result, Congress passed a law which, among other things, gave broadcast stations the explicit right to negotiate forcompensation of their own.

Since then, there have been occasional flare-ups, but mostly, the two sides have had a quiet understanding: Rather than paycash forthe signals, operators would offer broadcasters other favorable deals. Forexample, cablecompanies agreed to payto carry Walt Disney Co.'snew networks such as ESPN2, in exchange forretransmitting Disney'sABC stations for free.

The battle forcash started gaining momentum in 2005 when Nexstar pulled stations from several cablesystems in pockets of Texas and Louisiana. After a 10-month impasse, Nexstar said it won payments that will total $50 million over five years forits 49 stations.

Then last year, CBS was split off from Viacom Inc. as a company with mostly broadcast assets. Before then, Viacom was content to allow cableoperators to retransmit CBS-owned stations' programs in exchange forpaying premiums to carry other Viacom channels, including MTV and VH1. Now retransmission payments form a key part of CBS Chief Executive Leslie Moonves'sbid to convince Wall Street that CBS isn't an old-media, slow-growth stock.

"We're going to get paid," Mr. Moonves recently told analysts at a Citigroup Inc. investor conference. "It will materially affect our numbers." He noted that last year Verizon Communications Inc. agreed to payCBS about $10 million forcarriage on the phone company'snew TVsystem, and said CBS is currently in payment negotiations with three small cableoperators. Mr. Moonves will take on cablebehemoths such as Comcast as contracts expire in the next few years, he said. By 2009, Mr. Moonves said, cablefees could total "hopefully hundreds of millions" of dollars just forhis company -- a far more optimistic assessment than the Kagan forecast.

Baltimore-based Sinclair entered the fray last year. Its 57 stations reach 13% of the country according to the FCC, far less than the current federal cap of 39% that bigger owners such as Fox and CBS are bumping up against. "When you're trying to knock down a dam, you do it piece by piece," says Barry Faber, Sinclair'sgeneral counsel. "First the smaller broadcasters will chip away at it, and then the big guns will come in."

Last summer, the company began pulling its stations in the Charleston, W.Va., area off of a cablesystem that has just been purchased by Suddenlink Communications, a midsize operator. Believing Suddenlink was vulnerable, Sinclair demanded a $40 million upfront fee plus around 50 cents per subscriber per month foreach of its two stations retransmitted by the cablesystem.

"Without the right to carry these stations, at least 25% of recently acquired subscribers will discontinue service, resulting in a loss of value of more than $150 million," Mr. Faber warned Suddenlink in an email that was included in an FCC filing. "Paying $40 million to . . . avoid such a loss seems to us a reasonable price to pay."

Suddenlink was forced to give ground. While final terms of the deal weren't revealed, people familiar with it say Suddenlink agreed to buy advertising and video-on-demand programming from Sinclair valued at close to what the broadcaster was asking forin cash. "Some broadcasters are abusing their market power," says Gerald Kent, Suddenlink'schief executive.

Mr. Commisso and other Mediacom executives knew they were in fora big fight with Sinclair from the beginning. From the outset, Mediacom was willing to paysome cash foraccess to Sinclair'sstations -- but only about half of what it was asking, according to people familiar with the talks.

Sinclair'sCEO Mr. Smith, who built the company from his father'stwo stations in Baltimore and Pittsburgh, is known as a pit bull of an executive. He made headlines during the 2004 presidential election forordering his stations to air a program that, among other things, questioned whether John Kerry'santiwar activities during the Vietnam conflict harmed POWs. He also drew criticism that year forbanning an episode of ABC's"Nightline" in which anchor Ted Koppel read a lengthy list of American military personnel killed in Iraq.

An immigrant from Calabria, Italy, at the age of 12, Mr. Commisso worked his way through Columbia University. He says the remark he made to Mr. Smith about having had a gun at his head referred to a time when he was robbed as a teenager delivering pizza in the Bronx. Sensitive about his Italian background, he accused Sinclair executives of "ethnic stereotyping" during their dispute, according to Mediacom'sFCC filing.

Sinclair had a better bargaining position: More than half of Mediacom'ssubscribers were getting at least one channel retransmitted from one of Sinclair'sstations. But those stations accounted forless than 5% of Sinclair'srevenues.

In the July meeting between the CEOs, Mr. Smith wouldn't budge much in the three-hour session. At one point he asked, "How will it feel to not have the Super Bowl in February?" according to people in the room.

Sinclair then turned up the pressure. In September, just as Mediacom was on the verge of selling $300 million in debt, Sinclair sent a letter to Mediacom saying that its right to carry Sinclair'sstations would be terminated on Nov. 30. Mediacom executives were outraged at what they described as a blatant attempt to torpedo their financing.

Mediacom also says Sinclair steadily upped its demands. "That'snot someone negotiating in good faith," Mr. Commisso says. But when Mediacom took its complaint to the FCC, the agency handed back a tough decision. Just two days before the blackout began, the commission'sMedia Bureau ruled that Sinclair was bargaining in good faith. The ruling also recommended that the two sides submit to binding arbitration, but didn't require it as Mediacom had requested.

Meanwhile, Sinclair had teamed up with DirecTV, the nation'slargest satellite-TVprovider, to target Mediacom subscribers with as much as $150 rebate offers if they switched to satellite service from cable.

Many Mediacom customers stuck with their cablecompany, believing it was trying to hold down their rates. "I can do with missing some showsas long as I know someone'sbattling forour benefit," said Dale Buck, a sergeant on the Des Moines, Iowa, police force.

But others switched: DirecTV reported it was adding new customers at a 70% higher rate than the previous year in Cedar Rapids, Iowa. Mediacom is down to 1.4 million cablesubscribers, 200,000 less than five years ago, although revenue is up thanks to the introduction of new services like high-speed Internet.

In the past few weeks Mr. Commisso was insistent he wouldn't buckle further, fearing the precedent he would set forhis industry. "There'sa big squeeze going on here," he said. The company appealed the FCC decision and last week was trying to get Congress to intercede. On Wednesday, two influential senators called on the FCC to reverse itself and force binding arbitration on Sinclair.

But on Friday, the two sides came to terms Mr. Commisso had hoped to avoid. Mr. Commisso says he gave in largely because of Chairman Martin'shistory of siding against the cableindustry on key matters. "He was predisposed to give Sinclair and the broadcasting industry a major win," he says. A spokeswoman forMr. Martin said he decides each issue on its merits, and noted that he has sided with the cableindustry on a number of matters.

Sinclair'sMr. Faber wouldn't give details but said, "We're very happy and we didn't cave." Mediacom also agreed to dismiss all FCC and legal matters and to pay forSinclair'slegal fees from the dispute.