* CBS: Time Warner Cable trying to hurt its online content
* Time Warner Cable says CBS uses coercive practices
* Customers could miss PGA Championship if no deal reached
* Both parties confirm they are negotiating again
By Liana B. Baker
Aug 8 A CBS Corp executive said on
Thursday that negotiations with Time Warner Cable Inc
have "gone badly off course" and accused the cable company of
trying to negotiate terms that would limit CBS's ability to do
business with such online TV services as Netflix Inc
and Amazon.com Inc.
The comments, made at a New York City hearing on Thursday,
came on the seventh day of a blackout that has deprived more
than 3 million Time Warner Cable customers from watching CBS
stations in large U.S. markets including New York and Los
Despite the war of words, both companies confirmed on
Thursday that they are negotiating again.
If the two companies fail to strike an agreement by Sunday,
Time Warner Cable customers in the affected cities will miss
golf's PGA Championship, the final tournament of the four major
golf events this year.
Rory Whelan, Time Warner Cable's regional vice president of
government relations, in testimony at the same hearing, accused
CBS of "coercive bundling practices" and said CBS's blocking of
Time Warner Cable's Internet content exhibits conduct "beyond
the pale." Testimony from both executives was provided to
Reuters by the companies.
Martin Franks, an executive vice president at CBS, said Time
Warner Cable has been insisting on securing the same terms and
conditions of their last agreement which started in 2008 and
expired in June. He said Time Warner Cable is asking for terms
that would supply it with some CBS content for free, which
online players such as Netflix pay "millions of dollars to
"Perhaps their real aim here is to use those outdated terms
to hamstring our ability to do business with Netflix, Amazon,
Hulu Plus and other new entrants that pose a new competitive
threat to their former, cozy, unchallenged monopoly status,"
He added that "CBS is not going to become Time Warner
Cable's accomplice in trying to throttle those new services,"
referring to companies such as Netflix and Amazon.
Time Warner Cable said at the hearing that it had proposed
two options for it to resume carrying CBS, which were both
rejected by the broadcaster. Earlier this week, Time Warner
Cable's chief executive, Glenn Britt, made a proposal to CBS CEO
Leslie Moonves to sell CBS as a single channel, rather than part
of a package, a move Moonves dismissed as an empty gesture. [ID:
Time Warner Cable also said in its testimony on Thursday
that it offered a new proposal for CBS to carry its signal
temporarily until the two companies can hash out a new deal. It
said that CBS refused the offer, and that it hopes the
Aereo Inc, the online television venture backed by Barry
Diller, said on Thursday it was expanding service to Dallas, one
of the cities affected by the blackout.
Aereo is controversial within the industry because it pays
no licensing fees to broadcasters. The TV industry is concerned
that Aereo, which allows subscribers to live-stream broadcasts
of TV channels, could threaten the traditional business model.