Roundup: Time Warner Cable vs. CBS, and the 3 Million Blacked-Out Viewers Caught in the Middle

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by Beth Hanna
August 6, 2013 1:26 PM
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Time Warner Cable customers can forget seeing Stephen King's "Under the Dome" or "60 Minutes" on CBS or Showtime's "Ray Donovan" for the foreseeable future. In the latest round in their Battle of the Titans, Time Warner Cable CEO Glenn Britt has sent a letter to CBS CEO Leslie Moonves to resume negotiations immediately with the network and to cease blocking CBS.com content -- a move that CBS calls a "sham." 

Since Time Warner's black-out of three million customers in Los Angeles, New York and Dallas over CBS programming fees, the web has been quick to point out that neither of these companies are exactly hurting for money, and viewers shouldn't be put in the middle of the fight. Below, a roundup of opinions on these -- as the Daily Beast puts it -- "Bickering Behemoths."

The Hollywood Reporter:

While the letter from Britt seems to be an olive branch, he also pokes at CBS by adding that Internet customers should not be blocked "given that CBS uses free public airwaves to broadcast that content and has public interest obligations that it is plainly flouting."

UPDATE: In response, CBS issued the following statement:

"Today’s so-called proposal is a sham, a public relations vehicle designed to distract from the fact that Time Warner Cable is not negotiating in good faith.  Anyone familiar with the entertainment business knows that the economics and structure of the cable industry doesn’t work that way and isn’t likely to for quite some time. In short, this was an empty gesture from a company that is expert at them."

New York Times (David Carr):

Blacked-out Time Warner Cable customers were confronted by the following propaganda on their screens:

“The outrageous demands from CBS, the owner of Showtime and TMC, has forced us to remove it from your lineup while we continue to negotiate for fair and reasonable terms.”

“Forced us. . . .” Really, Time Warner Cable? It seems more like the business negotiation you were having with a supplier did not yield the desired result and you’ve chosen to turn up the heat.

Not to be outdone, a statement from CBS made sure everyone understood that the network was really doing the people’s work in responding to the news:

“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 shortsighted, anti-consumer strategy.”

Here's an idea for both parties: Leave us out of it.

The Daily Beast:

Never mind that Time Warner Cable is a $33.5 billion enterprise that in the second quarter of 2013 posted $481 million in earnings, exceeding Wall Street’s expectations and sending the stock soaring. Yet a couple of days ago, TWC chief executive Glenn Britt argued that “if we paid CBS what they are asking, the next broadcaster or programmer would ask us—and others like FiOS, AT&T and DirecTV—for even higher prices next time. Cable TV bills would skyrocket. You’d be mad. We’d be mad. It won’t end well for anyone.”

CBS, a similar-sized company whose second-quarter earnings exploded in a record $476 million (and whose CEO, Leslie Moonves, made $62.2 million last year—more than three times Britt’s compensation package), is also apparently suffering terrible abuse.

New York Times (Alessandra Stanley):

As a subscriber in New York, I felt like the child who walks into the house to hear Mom explain that Dad is gone and can be visited on Wednesdays and alternate weekends. Children don’t care why, or who was wronged; they just don’t want divorce to change anything, and they especially don’t want to commute across town to see their father.

Plenty of people don’t love “Under the Dome” and rarely watch CBS (“The Big Bang Theory” reruns can be found on other channels), and relatively few prefer “CBS This Morning” to “Today” or “Good Morning America.”

But people don’t like to be told they can’t watch CBS because Time Warner Cable doesn’t want them to.

TIME:

Late Sunday, a resolution to the dispute remained elusive. In fact, Time Warner Cable and CBS couldn’t even agree on whether any negotiations were under way, according to the Wall Street Journal. A Time Warner Cable spokeswoman told the paper that talks were “ongoing,” while CBS said “there are no negotiations taking place at this time.”

Wall Street Journal:

Generally, both sides and consumers lose during a blackout. Cable and satellite operators see subscriber defections and television channels suffer steep declines in ratings... Time Warner Cable has warned that it could put another network into CBS's channel slot permanently after a blackout. The cable operator said last week it was in talks with several programmers to take the slot.

Tech Crunch:

In a phone interview early Sunday morning, Dr. Phillip Pangloss told me that he believes the skirmish will result in the “best of all possible worlds” for all parties involved…

Pangloss is the author of the upcoming book “Blackout Nation: The Inside Story Behind Big Cable’s Programming Renaissance,” which he wrote after studying the relationship between network programmers like CBS and distributors like Time Warner Cable for more than seven years. The book takes a qualitative look at the results of more than two dozen recent blackouts of the last several years — and what it concludes might surprise you.

In every case, Pangloss says, the temporary blackout of a broadcast or cable network due to contract negotiations with an operator has resulted not only in greater profits for all parties involved, but also better programming and a more valuable cable package for consumers. And he believes that the most recent skirmish between Time Warner Cable and CBS will be no different.

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