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Time Warner & CBS Reach Content Carriage Agreement (New York, Dallas, LA)

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CBS-Time Warner Cable Blackout Deadline Extended

By Liana B. Baker

NEW YORK, July 23 (Reuters) - Millions of Time Warner Cable customers will get an extra day to watch CBS shows before the companies' programming agreement expires in large markets such as New York and Los Angeles, both companies confirmed on Tuesday.

The deadline to hammer out a new agreement between Time Warner Cable, the second largest U.S. cable operator, and CBS, the No. 1 rated broadcast network, has been moved to Thursday at 9 a.m. EDT from Wednesday at 5 p.m. EDT.

The deadline was extended not because there was any progress in talks but because of a technicality related to U.S. Federal Communications Commission rule about pulling signals during a "sweeps" period, according to a source familiar with the matter.

CBS Corp Chief Executive Officer Leslie Moonves issued a memo to employees on Tuesday over the programming fight with Time Warner Cable that threatens to pull popular shows like "The Big Bang Theory" off the air in several major markets.

Threats of blackouts have become increasingly common in the TV business as networks, which provide programming, and cable operators, which transmit that content into living rooms around the country, battle over terms in contentious negotiations.

The negotiations over how much Time Warner Cable will pay CBS to carry the network in New York, Los Angeles and Dallas are stalled, according to the memo.

"We have offered Time Warner Cable a short-term extension as we continue to negotiate, but to date they have refused," Moonves wrote in the memo, calling the fight a "crucial struggle."

A Time Warner Cable spokeswoman said in response that it had not refused an offer and "we'd be happy to consider an extension offer, but right now we want to continue to negotiate to try to reach an agreement before the expiration."

For several quarters Moonves has trumpeted retransmission fees - an industry term for how much cable, satellite and telecommunications operators pay broadcast networks to carry the channel - which bring in sizable revenue. CBS has said it is on track to generate $1 billion in these types of fees by 2017.


Time Warner Cable Threatens to Take Coveted Channel 2 Slot Away From CBS
1:50 PM PDT 7/24/2013 by Alex Ben Block 

As the tense talks over retransmission fees continue toward the Thursday deadline, the network says it will not make any deal that doesn’t maintain their position.

Tense negotiations on a new retransmission consent deal between Time Warner Cable and CBS Inc. continued Wednesday but all indications are it is still unlikely there will be an agreement before the 9 a.m. deadline on Thursday because the parties are still so far apart on the value of the subscriber fees.

In the latest maneuver, Time Warner Cable says that if they black out CBS on their systems until a deal is made, they may auction off the coveted channel two slot on their program lineup – making it permanently unavailable.

Historically, the lower the slot on the line up the better. Typically, when a TV set is turned on, a viewer begins looking for something to watch at the default point of a channel lower on the line up.

A spokesperson for TWC told The Wall Street Journal, “if CBS goes dark, they likely lose their space on the (channel) lineup” permanently in the markets most affected by these talks – New York City, Los Angeles and Dallas/Ft. Worth.

CBS appears to be taking that as an effort by TWC to gain leverage in the talks. In a statement to The Hollywood Reporter, a CBS spokesperson said: “CBS obviously won’t be making any deals in which we are required to change our channel position.”

On background, sources at TWC and CBS confirmed it does not look likely a new deal will be reached before the current deadline. That means CBS stations, CBS Sports and the Smithsonian Chanel may all go dark. There is also a chance it could force CBS owned pay TV service Showtime to go dark as well.

CBS has offered a short-term extension of the deadline while talks continue but so far TWC has declined that offer. Sources say TWC wants a deal as soon as possible because each day that passes gets them closer to September 5 when NFL football on CBS resumes. A blackout of the games is expected to anger football fans who are TWC subscribers.

The next major sports event scheduled to air on CBS is the U.S. Open tennis tournament, which begins August 26 and runs until September 9.

David Banks, a Wall St. analyst with the firm RBC Capital Markets, said in an interview on CNBC that ultimately CBS has the stronger negotiating position because “typically in this business it’s the content that wins … content has the leverage.”

During the interview, a graphic based on data from SNL Kagan showed that ESPN gets $5.54 per subscriber per month from cable operators while TNT gets $1.24, Fox News gets 94 cents and CBS gets 88 cents per sub.

Banks said we have entered an era where these retrans fees are being “re-valued.”

“I think CBS has a great case,” said Banks, “because of their audience level and program investment.”

Banks said today the economics of media are that advertising and subscriber revenue are needed to afford a menu of quality programming.

Another issue is the terms of the deal. In August 2010, CBS did a ten-year deal with Comcast on retransmission fees. The longer the deal, usually the more the cable distributor has to pay for that long-term peace of mind.

In the case of the Comcast deal, Banks said -- and company sources confirmed -- CBS would be asking for a lot more money if that was being negotiated today.

CBS CEO Leslie Moonves has said they now want full value for their content and think it is wrong that they get the higher ratings but are paid less than many others, such as TNT, who can’t match their offerings.

STORY: Time Warner Cable CEO Talks Carriage Disputes at London Conference

At a Bank of America conference in September 2012, Moonves recalled the history of retransmission revenue. Three years ago, he said, CBS was receiving no retransmission cash. Five years ago, the network was paying its affiliates to carry CBS programming. In 2012, he estimated cable, satellite and telco TV distributors will pay CBS more than $250 million in retransmission fees.

Moonves at that time said CBS expects those feels to reach $1 billiion by 2016.

“People are realizing the value of our content,” Moonves said at the time. “They can’t live without the things we provide — the NFL, CSI, Two and a Half Men, Big Bang Theory, 60 Minutes. So our affiliates and our (cable)  partners realize they need to pay. The ecosystem has changed dramatically.”

Time Warner Cable, CBS agree to extend negotiations over fees
July 25 | Wed Jul 24, 2013 11:57pm EDT

(Reuters) - Time Warner Cable Inc, which is battling with the CBS broadcast network over the fees it pays to carry certain CBS channels, said the companies will continue negotiating until Monday.

"Both parties have agreed to an extension through Monday, July 29 at 5 p.m.," Time Warner Cable spokeswoman Maureen Huff told Reuters late on Wednesday.

If both the companies had failed to reach a new deal by Thursday, CBS would have gone dark in markets like Los Angeles and New York, depriving viewers of summer shows such as "Under the Dome" and "Big Brother."

CBS officials could not immediately be reached for comment by Reuters outside of regular U.S. business hours.

Time Warner Cable Customers Lose CBS, NBC Stations in Four Cities
Variety By Todd Spangler | Variety – 8 hours ago..

Time Warner Cable postponed the drop-dead date in its contract fight with CBS to Monday, but a separate dispute with Journal Broadcast Group resulted in a blackout of CBS and NBC stations in four markets around midnight local time Thursday.

TW Cable said more than 600,000 of customers are affected. Its retransmission-consent deal with Journal Broadcast had been set to expire June 30, but the companies extended pact through July 24 for four stations: WTMJ (NBC) in Milwaukee; WGBA (NBC) in Green Bay, Wisc.; KMTV (CBS) in Omaha, Neb.; and KMIR (NBC) in Palm Springs, Calif.

The MSO did not provide an estimate on when it expected to reach a deal with Milwaukee-based Journal Broadcast. The cable company has claimed the broadcaster is seeking a 200% fee hike, while the Journal Broadcast characterizes the increase as just pennies per day per subscriber.

“At Time Warner Cable, we continue to take a stand against such unreasonable fee increases because we don’t think it’s fair for customers to pay such a huge increase for programming that is delivered for free via an antenna, and online,” the cable company said in a notice posted at

Journal Broadcast Group said in a statement that it is “deeply disappointed to announce that Time Warner Cable has put aside the needs of our local viewers and taken our stations off their systems serving the Milwaukee, Green Bay/Appleton, Omaha and Palm Springs DMAs… We stand ready to return to the bargaining table to resolve our differences and resume serving the Time Warner Cable customers in our markets.”

Time Warner Cable’s higher-profile clash with CBS covers 13 owned-and-operated stations, including WCBS in Gotham, KCBS in LA and KTVT in Dallas. Also covered in that pact are carriage of CBS cablers Showtime, CBS Sports Network and Smithsonian Channel.

TW Cable on July 10 dropped two low-power Journal Broadcast stations affiliated with MyNetwork TV, WACY in Green Bay and WPSE in Palm Springs. The NBC and CBS stations stayed on Time Warner Cable under an FCC rule that forbids commercial stations to be removed during the sweeps ratings period.

According to Journal Broadcast, the station group has successfully negotiated more than 140 retrans contracts with other distributors without any interruption in service.

As has been the case in other broadcast blackouts, Time Warner Cable said affected customers could continue to access NBC shows on video-on-demand within 24 hours of original broadcast, and it noted that CBS primetime programming is available free at  – and also provided instructions on how to set up an over-the-air antenna.

In addition, the operator pointed out that many primetime programs are via online streaming services such as Netflix,, or may be purchased at Apple’s  iTunes Store.

'Difficult' talks ongoing with Time Warner Cable - CBS CEO Moonves

LOS ANGELES (Reuters) - CBS Corp Chief Executive Leslie Moonves said on Monday he remained engaged in "difficult" negotiations with Time Warner Cable Inc (NYSE: TWC - news) ahead of an afternoon deadline to agree on fees the cable company pays to carry the broadcast network.

Moonves, speaking at a Television Critics Association meeting, said he hoped to reach an agreement and avoid a blackout of the highest-rated broadcaster on cable systems in markets such as New York and Los Angeles.

Should no deal be reached, the blackout would occur some time after Monday's 5 p.m. EDT deadline.

"It's a very difficult negotiation," he said at the meeting in Beverly Hills. "We feel like we should be paid for our programming."

"I hope we don't go dark," he added.

Last week, the two sides agreed to extend their talks until 5 p.m. EDT on Monday, keeping CBS and summer hits like "Big Brother" and "Under the Dome" on the air.

A Time Warner Cable spokeswoman said in response that CBS is "already paid for their programming and we've offered an increase in CBS fees. We hope don't go dark as well."


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