UPDATED: 4:43 p.m. ET
CBS and Time Warner Cable have resumed talks on a new carriage agreement as a blackout of CBS programming to about 3 million cable subscribers continues, the companies confirmed.
Time Warner Cable dropped the signal on CBS stations in New York, Los Angeles and Dallas, plus cable channels Showtime and Smithsonian.
CBS is seeking an increase in its retransmission fees, while Time Warner Cable is seeking to limit its costs and add digital rights to CBS programming.
Earlier this week, Time Warner Cable CEO Glenn Britt sent a letter to CBS CEO Les Moonves offering terms to end the blackout temporarily. Moonves rejected the offer, accusing Time Warner Cable of "grandstanding."
A subcommittee of the New York City Council held a hearing on the CBS-Time Warner Cable blackout on Thursday.
The testimony of Martin Franks, executive VP of planning, policy and government relations, at CBS, who has negotiated many carriage deals, drew a reaction from Time Warner Cable.
Talking about one of the offers in Britt’s letter, Franks called terms in the expired deal that Time Warner Cable would like to operate under while a new agreement was being negotiated were outdated.
"They would result in Time Warner Cable receiving incredibly valuable CBS content for free" on digital platforms, Frank said.
"Perhaps their real aim here is to use those outdated terms to hamstring our ability to do business with Netflix, Amazon, Hulu Plus and other new entrants that pose a new competitive threat to their former, cozy, unchallenged monopoly status ... CBS is not going to become Time Warner Cable’s accomplice in trying to throttle those new services."
Time Warner Cable responded with a statement saying that "We categorically deny that we are trying to keep CBS from doing business with any new entrant. Both our expired and proposed agreements with CBS place no restriction on their ability to sell all of their product to Netflix, Amazon, Intel or any other entity, or continue to give all of their best content away for free online, as they have to date."