Time Warner Cable Proposes Restoring CBS While Talks Continue

Alternate Modest Proposal: Break CBS Out of the Bundle and See What Customers Will Pay

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Time Warner Cable CEO Glenn Britt sent a letter to his CBS counterpart Leslie Moonves on Monday afternoon proposing to return the network to subscribers in New York, Los Angeles and Dallas while negotiations continue.

Glenn Britt
Glenn Britt

The letter suggests that the right to stream CBS content digitally is the primary holdup to an agreement.

Mr. Britt proposed the two companies resume carriage "with the new economics TWC reluctantly agreed to during our negotiations," while keeping the terms and conditions of the recently expired contract, which would leave the cable operator "without the digital rights that CBS has provided to others."

Time Warner Cable offers subscribers an app that lets them stream live or on demand programming -- but primarily inside their homes. Only certain networks, such as BBC America, allow the company to stream their signals to devices outside the home, but Time Warner Cable has committed to expanding the selection.

Mr. Britt alternately suggested that CBS allow it to offer the network on an a la carte basis at a price and on terms of its choosing, with all proceeds going to CBS. But it is unlikely the network will take that idea seriously. Broadcasters generally like the system now in place, partly because they don't have to impose the kind of price hikes at play in this dispute directly on consumers.

CBS said it was working on an answer. "CBS received Mr. Britt's 'offer' simultaneous with its release to the media," a spokeswoman said by email. "We are formulating our response."

Mr. Britt also asked the company to stop blocking CBS.com content from Time Warner Cable's high-speed internet customers. CBS blocked streaming capabilities on Friday, including in cities where Time Warner Cable continues to carry the network, and for internet customers who use other pay-TV providers such as DirecTV.

"Regardless of the other issues between us, it is surely beyond the pale for you to subject these internet customers to blocking of content that is made available for free to all others," Mr. Britt wrote.

Time Warner Cable pulled CBS in New York, Dallas and Los Angeles on Friday at 5 p.m. It also pulled CBS sibling Showtime in major markets.

The dispute centers on CBS's demands for an increase in fees it gets in New York, Dallas and Los Angeles -- a boost to levels that Time Warner Cable has claimed are 600% higher than it pays the network in other markets.

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