CBS, TWC Battle Ends – Carriage Deal Reached4 Sep, 2013 By: Doug McPherson
NEW YORK – The month-long battle over retransmission consent between CBS Inc. and Time Warner Cable is over. CBS channels, including Showtime, returned to TWC's systems in New York, Los Angeles, Dallas and other markets Monday afternoon.
The blackout started when TWC balked at CBS’s demands for a subscriber increase from $1 to about $2.
In a memo to CBS employees, CBS CEO Leslie Moonves writes: “In spite of the pain it caused to all of us … [the dispute] was an important one, and one worth pursuing to a satisfactory conclusion. That has been achieved. The final agreements with Time Warner Cable deliver to us all the value and terms that we sought in these discussions. We are receiving fair compensation for CBS content and we also have the ability to monetize our content going forward on all the new, developing platforms that are right now transforming the way people watch television.”
CBS also reports the blackout had a minimal effect on ratings.
A statement from TWC CEO Glenn Britt reads: “As in all of our negotiations, we wanted to hold down costs and retain our ability to deliver a great video experience for our customers. While we certainly didn’t get everything we wanted, ultimately we ended up in a much better place than when we started.”
But Britt also took the opportunity to criticize the concept of retransmission consent, which allows broadcasters to demand ever-increasing fees to carry their shows on cable and satellite.
“We are also encouraged by the 50-plus consumer organizations and legislators that supported our call for Congress and the FCC (Federal Communications Commission) to reassess the 1992 retransmission consent rules,” he writes. “The rules are woefully out of date, and are the primary reason cable bills are rising, and too frequently leave our customers without the programming they love. We sincerely hope that policymakers heed that call and take action to prevent these unfortunate blackouts soon.”
No terms of the settlement were announced, and there was no mention of TWC getting TV Everywhere rights, which would allow it to distribute an app to its subscribers so they could get CBS channels on their mobile devices. The announcement does note that the agreement does cover Bright House Networks and CBS Sports Network.
TWC has promised Showtime pay-channel subscribers a rebate (estimated to be around $20), but it will not compensate anyone for the CBS channels, including WCBS (New York) and KCBS (Los Angeles). That has brought about at least one class action suit against TWC for the loss of service it promised. Some analysts had predicted a forthcoming settlement because of the upcoming NFL season.
In related news, MediaPost reports a TWC representative sent an E-mail explaining that the FCC discouraged TWC from filing a complaint against CBS. But the E-mail didn’t elaborate on any details regarding the FCC's position about its filing a complaint.
A CBS E-mail said that it did not file a complaint against TWC because it felt market forces should prompt a solution.