Time Warner Cable loses broadcast TV in some areas

By Yinka Adegoke

NEW YORK (Reuters) - Time Warner Cable Inc said on Friday it lost the right to carry some broadcast channels on its cable systems in 13 U.S. cities after it failed to reach an agreement with broadcaster LIN TV Corp.

Some 1.5 million subscribers in cities like Buffalo, New York; Columbus, Ohio; and Green Bay, Wisconsin, will not receive free-to-air broadcast local affiliate stations of General Electric Co's NBC affiliate, News Corp's Fox and CBS Corp's namesake network after Time Warner Cable's agreement with LIN TV ended Thursday.

"Time Warner has known since August that the contract expired on October 2nd," LIN TV said in a statement. "We previously offered Time Warner an extension and they didn't' accept it, nor even respond."

At dispute between Time Warner Cable and LIN TV is the long-simmering issue of retransmission rights. Broadcasters like LIN TV and Sinclair Broadcasting have started demanding cash payments from cable and satellite operators to carry their broadcast stations.

"Despite acknowledging progress in the negotiations, LIN took the extreme step of removing its signal," said Melinda Witmer, chief programing officer at Time Warner Cable. "We asked for a very short extension to complete negotiations, but it was LIN's preference to pull their signal off the air."

Previously, broadcasters have negotiated noncash agreements in exchange for payment to carry a broadcaster's cable networks. The broadcasters' primary revenue stream is advertising, which has begun to shrink in recent years and has been further exacerbated by the ongoing economic downturn.

"LIN TV already makes millions of dollars in additional advertising revenue as a direct result of being on Time Warner Cable," Witmer said. "Demanding more is just plain greedy and our customers deserve better."

LIN and Time Warner Cable said they are still in talks.

Time Warner Cable said LIN TV is demanding that its customers pay a monthly fee to watch the channel and said it has never charged for broadcast programing.

Both Time Warner Cable and LIN TV said subscribers would be able to watch the broadcast channels -- if they had "rabbit ear" antennas to receive the signals.

Time Warner Cable said it has begun offering free antennas to its subscribers so they don't miss their favorite programing, including big football games coming up over the weekend.

LIN TV has reached retransmission agreements with most of the biggest pay-TV providers in recent months, including Comcast Corp, DIRECTV Group Inc, and Charter Communications Inc.

(Reporting by Yinka Adegoke, editing by Gerald E. McCormick)