Time Warner Cable drops CBS as talks over fees fall short

The two sides fail to reach a fee agreement resulting in a blackout of CBS in several major U.S. cities. Online alternatives give consumers a way to keep watching CBS content -- just not from the broadcaster itself.

CBS and Time Warner Cable logos against the New York skyline
Mari Benitez/CNET

Update, 5:17 p.m. PT: Notes that CBS is blocking full-episode streaming on its Web site for some with Time Warner Cable as their broadband provider.

With changes in technology complicating the balance of power between television creators and distributors, CBS and Time Warner Cable failed to reach an agreement on fees Friday. After weeks of talks and multiple deadline extensions, the broadcaster's flagship network went dark for the cable giant's subscribers in several major U.S. cities.

CBS being dropped from a cable system for the first time in its history opens the door for companies like Aereo, the online streamer of over-the-air broadcasts, to deliver those transmissions in real time for Time Warner subscribers in New York. Time Warner subscribers can also turn online to CBS's Web site or Amazon to watch popular shows like "Under the Dome."

Time Warner Cable, on a screen that pops up where CBS's programming should be, is directing its subscribers to turn to CBS.com to watch, but CBS appears to be eliminating the option to watch full episodes on its Web site for some. In New York, people with Time Warner Cable as their broadband provider couldn't access any CBS full-length videos online, nor could people with TWC as their provider in other parts of the country unaffected by the blackout.

"If Time Warner Cable is a customer's internet service provider, then their access to CBS full episode content via online and mobile platforms has been suspended as a result of Time Warner Cable's decision to drop CBS and Showtime from their market," CBS spokeswoman Dana McClintock said in an email. "As soon as CBS is restored on Time Warner Cable systems in affected markets, that content will be accessible again."

Time Warner Cable spokeswoman Maureen Huff said CBS should not be allowed to abuse the privilege of using publicly owned airwaves to deliver its programming. "CBS has shown utter lack of regard for consumers by blocking Time Warner Cable's customers, including our high-speed data only customers, from accessing their shows on their free website," she said.

CBS, which is the parent company of CNET, said in a statement it "deeply regrets" that Time Warner Cable has dropped its network in New York, Los Angeles, and Dallas, as well as other smaller markets. It criticized Time Warner for "indulging in pointless brinksmanship" and twisting the facts to the public, and said it is eager to make an agreement with "fair compensation for the most-watched television network with the most popular content in the world."

"We hope and believe this period of darkness will be short," the broadcaster said.

Time Warner Cable said that when it agreed to continue talks until Friday, it expected to engage in a meaningful negotiation with CBS. "Since then, CBS has refused to have a productive discussion," it said.

"It's become clear that no matter how much time we give them, they're not willing to come to reasonable terms," it added in a statement.

In addition to the blackout of CBS in select markets, CBS properties Showtime, TMC, FLIX, and Smithsonian are also going dark for all subscribers.

CBS Corp. and Time Warner Cable have been negotiating a new carriage pact with under multiple extensions to their previous agreement that expired June 30.

Failing to reach an agreement on retransmission fees -- money that CBS requires from TWC to carry the channel for its subscribers -- comes as customers who lose CBS stations face more online alternatives. Time Warner has gone so far as to encourage New York customers to explore Aereo, the online streamer of over-the-air broadcasts, to pick up the broadcasts that have been dropped from its cable packages. Usually, many CBS shows are available on the network's own Web site, typically for a limited window of time, and Amazon Prime customers can watch "Under the Dome" on its Instant Video service four days after they run.

Update, 5:33 p.m. PT: Adds comment from CBS spokeswoman Dana McClintock.

Update, 5:44 p.m. PT: Adds comment from Time Warner Cable spokeswoman Maureen Huff.

 

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