CBS, Time Warner Cable agree to brief contract extension

The two companies, which have been engaged in contentious negotiations over a new carriage contract, agree to an extension through July 29.

CBS
CBS

Time Warner Cable subscribers will not lose access to CBS Corp. programming on Wednesday night after all, despite a looming deadline and apparently no new carriage contract in place.

The two companies, which have been engaged in contentious negotiations over a new contract for CBS Corp.'s flagship CBS network, have agreed to an extension that will allow the cable giant's subscribers to continue receiving the network's programming through July 29 at 2 p.m. PT, a Time Warner Cable spokesperson told CNET this evening. A spokesperson for CBS, which is the parent company of CNET, could not immediately confirm the extension.

The two companies had been negotiating under an extension to their previous agreement that expired June 30. That extension was due to expire tonight, resulting in a threatened blackout for 3 million Time Warner Cable customers. CBS-owned channels Showtime and TMC are also at risk for all the cable operator's subscribers.

The high-stakes talks between the two companies have apparently been fierce, with both sides accusing the other of trying to derail negotiations. Time Warner Cable has said CBS was asking for a 600 percent markup on fees compared with what it pays in the rest of the country, while CBS said Time Warner Cable wouldn't negotiate the standard deal that all other cable, satellite, and telecommunications companies have struck with the network.

In a sign that talks were not going well, CBS started running ads in New York, Los Angeles, and Dallas last week warning that Time Warner Cable customers could lose access to its shows on Wednesday when the extension expires.

In response to those ads, Time Warner Cable indicated it was prepared to recommend that its New York subscribers use streaming startup Aereo to access local programming if CBS pulled the plug, a spokesperson for the cable giant told The New York Times on Sunday. Aereo, which uses antenna/DVR technology to let consumers watch live, local, over-the-air television broadcasts on some Internet-connected devices, is already operating in New York and is planning a launch in Dallas this year.

In addition to possibly providing the streaming startup with a larger user base, the gesture serves as a bit of an insult as it endorses a legal foe of CBS. Aereo charges $8 per month for use of its cloud-based antenna/DVR technology and 20 hours of DVR storage. That service has provoked lawsuits from TV broadcast giants including ABC, CBS, Fox, NBC Universal, and Telemundo, which alleged last year that the service violates their copyrights and that Aereo must pay them retransmission fees.

While inconvenient to TV viewers, contract disputes resulting in programming blackouts have become common. After contracts between DirecTV and Viacom broke down last summer, programming for nearly 20 channels was withdrawn from the satellite TV provider for more than a week before an agreement was finally reached. In 2012, Dish Network dropped AMC Network channels from its lineup for four months, claiming that the network's programming, which includes "Breaking Bad" and "Mad Men," didn't justify the increased fees the TV network was demanding.

 

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