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Cable Technology Feature Article

September 03, 2013

CBS Restored to TWC Lineup, But Effects Linger

By Tara Seals, TMCnet Contributor

One month after CBS pulled its channel feeds from Time Warner (News - Alert) Cable’s lineup, the programming blackout is over: the two have buried the hatchet on the ongoing retransmission feud, which resulted in a blackout for three million of TWC’s customers.

The two have been at an impasse since June, when the existing contract to carry CBS programming ran out. TWC said that the broadcaster wanted a 600-percent increase to $2 per subscriber per month for its content, along with that of the Smithsonian Channel and Showtime. After failing to reach a new agreement, the lights went out for 25 percent of TWC’s base in eight markets, including the key DMAs of Dallas-Ft. Worth, Los Angeles and New York City. The blackout cost CBS $3 million per day in lost retransmission fees, while TWC suffered churn (Verizon claimed a 16-percent spike in NYC-area FiOS (News - Alert) uptake) and got slapped with a class action lawsuit. The latter has been filed in Los Angeles Superior Court demanding recompense for the money the plaintiffs paid for CBS and Showtime programming that wasn’t delivered.

"We're pleased to be able to restore CBS programming for our customers, and appreciate their patience and loyalty throughout the dispute," said Time Warner Cable CEO Glenn Britt, in a statement. "While we certainly didn't get everything we wanted, ultimately we ended up in a much better place than when we started."

CBS, the No. 1 broadcast network, was at a disadvantage in the negotiations thanks to the summer programming lull that accompanied the blackout. The Stephen King thriller Under the Dome is the only series with new episodes at the moment. However, all of that was set to change with the kickoff of the football season and CBS’ first NFL game, set to air Sept. 8.

The ramifications of the dispute and the high-profile blackout were the subject of several analyst musings on the future of TV. “The reported size of the retrans fees being asked (up to $2 per sub per month), the importance of digital rights, the possibility of losing the affected TV station's channel position and the willingness of large multichannel operators to hang tough even in major markets, have made this dispute one that may be cited as a turning point in the industry," said SNL Kagan analyst Robin Flynn in a blog post.

Britt, meanwhile, urged regulators to make changes to the 1992 retransmission consent rules. "We sincerely hope that policymakers heed that call and take action to prevent these unfortunate blackouts soon," he said.

CBS' programming resumed at 6:00 p.m. ET Monday. The companies didn't disclose specific terms of the deal.

Edited by Rachel Ramsey

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