Leslie Moonves, the CBS president, underscored the contrast in the negotiations in a memo he sent to CBS employees noting that the deal with FiOS was “reached swiftly and amicably in just a few days.” The battle with Time Warner Cable began Aug. 2 with no end in sight. CBS programs are blacked out in more than three million homes.
Coincidentally, the coverage areas for Time Warner Cable and FiOS overlap in this case. The major areas of FiOS covered under the new agreement are in the metropolitan regions of New York, Los Angeles and Dallas.
In his memo, Mr. Moonves made a point of emphasizing that this deal included only what are known as over-the-air rights — that is, permission to retransmit the signals of CBS stations in those areas. That means all of CBS’s programming would be available.
What it does not cover are digital rights to CBS programs, which are now at the heart of the stalled negotiations with Time Warner Cable. CBS wants to retain those rights, which include the ability to sell libraries of CBS programming to digital outlets like Netflix and Amazon. The cable company wants to gain access to those rights in any fee increase it pays CBS for retransmission rights.
FiOS actually has slightly more subscribers in the covered areas than Time Warner Cable, about 3.5 million compared with 3.2 million. One difference with the FiOS negotiation is that it did not include CBS’s sister premium cable channel, Showtime.
No financial terms were disclosed, though a CBS executive aware of the terms said that the deal included a substantial increase for CBS. In his memo, Mr. Moonves said CBS achieved “fair value.”
The negotiations with FiOS were conducted quietly and early — the previous deal was not set to conclude until the end of the year.
FiOS could play another role in the dispute with Time Warner Cable, besides being a flag that CBS will wave to underscore its ability to make agreements with other distributors. FiOS is generally available as an alternative to subscribers affected by the blackout of CBS stations on Time Warner Cable.
Article source: http://www.nytimes.com/2013/08/23/business/media/cbs-trumpets-deal-with-fios-tv-in-jab-at-time-warner-cable.html?partner=rss&emc=rss
