Updated
at 11 a.m. ET
CBS and Time Warner Cable agreed to an extension of their programming carriage
agreement until Aug. 2 at 5 p.m. ET while they continue negotiations, TWC said
early Tuesday morning.
The move follows a brief programming blackout around midnight ET Tuesday; less
than 30 minutes later, Time Warner Cable said it halted the blackout of CBS'
broadcast stations, Showtime, TMC, Flix and Smithsonian at CBS' request.
As of 12:43 a.m. ET, the companies resumed discussions, according to CBS. At
4:07, Time Warner Cable said they had agreed to an extension until Aug. 2 at 5
p.m. ET.
Followingmultiple extensions, around midnight ET, Time Warner Cable and CBS both
issued statements indicating carriage negotiations had broken
down, resulting in the networks going dark at midnight. At 12:29 a.m. ET,
a Time Warner Cable spokeswoman issued a statement saying, "At the request
of CBS, we have halted going dark on their channels." Shortly after, CBS
stated the companies "have agreed to continue discussions."
Time Warner Cable, in its midnight statement, said:
"The outrageous demands for fees by CBS Corporation have forced Time Warner
Cable to remove several of its networks and broadcast stations from our
customers' lineups. As of midnight ET, Time Warner Cable customers in New York
City, Dallas and Los Angeles will no longer receive their local CBS broadcast
stations. In addition, we have been forced to remove Showtime, TMC, Flix and
Smithsonian from our lineups across the country. We offered to pay reasonable
increases, but CBS's demands are out of line and unfair -- and they want Time
Warner Cable to pay more than others pay for the same programming."Â
The cable company added: "Fortunately,
CBS programming is still available free online at cbs.com and over the air with
an antenna. Showtime subscribers can watch some programming at sho.com.
For more information on other ways to watch these shows, customers should visit
www.twcconversations.com. We regret any inconvenience caused by the
CBS/Showtime blackout, and we're working hard to restore the programming at a
reasonable price. Switching is not the answer; sooner or later CBS will
threaten others and go dark, just as they have with Dish in the past and with
us today. We thank our customers for their patience, and we hope to
resolve this situation soon."Â
CBS, in its statement shortly afterward, said: "In spite of all our efforts to hammer out a fair
agreement, Time Warner Cable has dropped CBS and Showtime from its channel
lineup effective midnight edt. Meanwhile, they continue to engage in a
public campaign of disinformation and voodoo mathematics (featuring wildly
inflated percentages) while doggedly restating their positions."Â
CBS added that "Time
Warner Cable seems incapable of accepting the concept that the value of a
company's programming should be in line with its popularity. It is no mystery
why this company has dropped more than 50 television stations from its service
in the last five years alone, some as recently as last week. CBS remains
resolute in the pursuit of fair compensation for our programming and will use
the full resources available to us to make sure that Time Warner Cable
subscribers are aware of its short-sighted, anti-consumer strategy. In the end,
of course, an agreement will be reached. We continue to hope that outcome may
be achieved very soon and we can get back to focusing on delivering great
content to the customers we share."Â
The contract that was signed in 2009 -- covering retransmission-consent of 13
CBS-owned stations in eight markets within TWC's footprint, including WCBS-TV and WLNY-TV in
New York, KCBS-TV and KCAL-TV in Los Angeles and KTVT-TV and KTXA-TV in
Dallas-Ft. Worth -- was originally set to expire on June 30, but was extended
late last month until July 24. At that juncture, the sides agreed to another
interim extension through Monday's 5 p.m. cutoff, before the additional
three-hour negotiating window was opened, and then amended again until 9 p.m.
The other affected stations are: Boston (WBZ, WSBK), Pittsburgh (KDKA,
WPCW-CW), Denver (KCNC), Detroit (WKBD-CW) and Chicago (WBBM).
On Monday night just minutes before the 8 p.m. deadline, Time Warner Cable said
it had agreed to a new extension until 9 p.m., while the broadcaster noted
that "CBS and Time Warner Cable have extended their current deal again
into the evening while the companies continue to negotiate."Â
If Monday's extensions prove not to be the charm, some 3 million Time Warner
Cable subscribers may miss out on CBS network and local station far. Moreover,
all of the No. 2 MSO's customers could lose the cable programming, including
premium service Showtime, which is televising the final season of its top
series, Dexter, as well as its new original hit skein, Ray Donovan.
Negotiations between the parties had continued quietly and out of the public's
view until July 18. But at that point, Time Warner Cable and CBS began trading
barbs in competing ad campaigns, with TWC claiming the broadcaster is asking
for a 600% premium to what other CBS broadcast stations charge it on average.
CBS counters that TWC is refusing to negotiate the same sort of deal that other
distributors have reached with the network.
Investment firm RBC Capital estimates that CBS is now receiving between 75
cents and a $1 per sub per month from Time Warner Cable. AnalystMarci Ryvicker of Wells Fargo said the expired CBS-TWC agreement is
considered a sweetheart deal. She says CBS is pressing for a deal that will
eventually ramp up to $2 per sub.
Earlier on Monday at the Television Critics Association conference in Beverly
Hills, Calif.,CBS CEO Les Moonves was asked about the situation with Time Warner Cable.
"I really don't want to negotiate in public. That's probably not the best
way to do it," he said, noting he had been on the phone negotiating as
recently as 15 minutes prior. "It's a very difficult negotiation... I hope
we don't go dark. Conversations are happening between a lot of people today.
"
CBS, having long been the most-watched broadcast network, has chosen an
aggressive course when it comes to retrans, recording a 62% rise in payments
from cable, satellite and telco TV providers in the first quarter of 2013. The
company is said to seeking up to $500 million in total retrans fees in 2013.
That total could grow to $1 billion by 2016, four times the $250 million it
reaped in 2012.
TWC has also been talking about permanently removing CBS from its prized
Channel 2 positions in New York and Los Angeles if the stations go dark, noting
it has drawn in those spots from other programmers.
