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CBS Says Time Warner's Offer Is Just Empty PR

The Young & The Restless on CBS

The Young & The Restless on CBS

The dispute between CBS and Time Warner continues, as on Wednesday CBS Chief Executive Leslie Moonve replied to Time Warner chairman and CEO Glenn Britt's proposal offered on Monday, and clearly shows no sign that the two will back down from their blackout standoff. As it stands now, millions of Time Warner subscribers are without CBS, Showtime, The Movie Channel, Flix and the Smithsonian Channel.

"I was surprised to get your letter yesterday, particularly since I hadn't spoken to you in more than a week," Moonve told Britt. "Come to think of it, you haven't reached out to me personally, as I have to you on more than one occasion, even once during this entire matter, so your communication was both unexpected and welcome."

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Because Britt's letter was publicly released at the same time it was received by Moonve, he believes the Time Warner CEO's attempt to mend bridges was more of a dishonest public stunt rather than a sincere gesture. Backing this theory is a Time Warner exec and upcoming CEO who went on CNBC and said that he was "not aware of CBS having made a counterproposal or responded to our proposal in any way" not five minutes after the proposal was actually delivered to CBS.

Moonve called the Time Warner letter a "well-wrought distraction", and reminded the company that it has in its possession more than 100 pages of the original CBS proposal. He said the cable company never once returned a mark-up or reply about anything within the volume of economics, terms and rights agreements. Then on Friday, despite having a one-week extension to negotiate, Time Warner pulled the plug on programming.

"Why? Because, as your new CEO stated, Time Warner Cable would 'have more leverage' with CBS off the air and our viewers deprived of our programming," his letter states. "Since that night, Friday at 5:00 PM, we have not heard from anybody at Time Warner Cable to discuss anything at all, in spite of your public statements to the contrary. Until, of course, your public letter masquerading as a private one."

He goes on to call Time Warner's "a la carte" option an empty gesture, as the cable company industry really isn't set up for that kind of subscription-based access. He also pointed out how Time Warner forces subscribers to pay for Lakers and Dodgers channels even if they don't want them, yet Time Warner is having trouble paying for the network that brings viewers NFL, the NCAA Basketball Tournament and more.

"Are you really so reluctant to come to the same kind of agreement that we have struck – without incident – with every other cable operator, telco and satellite provider?" he states. "You already pay ten networks on your channel lineup more than you compensate CBS, all of which have far fewer viewers. What we are looking for, have always been looking for, is fair compensation for our content."

The drama goes on for a bit longer until Moonves concludes that instead of engaging in public posturing that does nothing more than create confusion, Time Warner should return to the negotiating table and talk about the real issues that are preventing millions of viewers from getting their daily dose of The Young And The Restless.

So who represents Victor Newman (Newman Enterprises) and who represents Jack Abbott (Jabot)?

  • sykozis
    Maybe CBS should come up with a new distribution model of their own.... Or maybe, just maybe, the cable companies and content providers should remove their heads from their anal cavities and learn to negotiate like real men and not children....
  • eklipz330
    just like radio, vhs, and newspapers, cable (and phone) IS the next thing to go! with google upping the ante on internet speeds as well as multiple companies offering cheaper distribution methods of sitcoms and shows, there is less and less reason to actually have cable! hell, just get a google phone and receive calls online!

    Not only that but cable company prices have been going up, and quality and customer service has plummeted. time warner is finding new ways to nickel and dime their customers (paying for wi-fi, really you assfaces?), i think TWC will be the next AOL.
  • sykozis
    AOL was doing just fine until the merger with TimeWarner back in the late-90's. That was the start of AOL's decline.
  • Marcus52
    I remember back when Time magazine published an article showing different evolutionary stages of man, and decided to put them in out of order because the height progression looked more pleasing to the eye (and doing nothing in the article to indicate what they did). They certainly weren't the first or last "news" source to bend the truth (actually we call that "lying" where I come from), but that article has stuck with me all these years, and my opinion of Time-Warner is pretty much the same as what it was after I learned the truth about it. Maybe that's unfair in light of the wide-spread dishonestly in reporting that has been with us for literally hundreds of years, and maybe it has nothing to do with the Time-Warner today, but I can't help but believe Moonve has it right and Time-Warner is being disingenuous here.
  • Mathos
    Actually neither of them really have it right. These major networks constantly upping the price for distribution of their content, is the reason cable companies keeping upping rates. There comes a point where the average customer finally says enough, and cuts the TV service off, and only sticks to their broadband connection.

    This is why people started streaming the content they wanted off the internet. Which is why cable companies and other broadband providers, started limiting monthly caps, due to streaming pulling customers away from broadcast content. Now, these major companies like CBS, ABC, NBS, etc. Won't allow cable companies to offer their content, unless they offer all their channels in a single package. This is the major obstacle blocking a la carte' services. Which is what most customers would really prefer.
  • sykozis
    The cable companies aren't honest in their pricing model. They set unreasonable "rental" prices for modems and cable boxes. In some cases, you're forced to "rent" the modem from the cable company (such is the case with Verizon FiOS service) if you want the internet service. Unless you want to pay an extra subscription fee to TiVo or use an HTPC, you're forced to "rent" a cable box from the cable company. These aren't optional devices if you want the service, yet they charge extra as if that were the case.

    The prices for service have more to do with desired profit margins and market share than they do operational expenses. Take my FiOS service for example. I get Cable, Internet and Phone for $109.99/month. If I drop the phone, my bill goes UP to $139.99/month. Where exactly is the honesty there? Whether or not I have the phone service doesn't effect how much it actually costs them to offer the cable and internet service. It actually doesn't impact the cost to provide the service at all since it's a VoIP type phone service that operates in the same manor as "Vonage" (only the hardware is installed in a box outside the house). BUT, to get the additional market share they increase the price if I opt out of the phone service.

    Both the cable companies and the content providers are out to make a profit. That is their sole purpose for existing. Neither cares what customers want as long as the customers are paying for the service. The only time either cares, is when customers stop paying....and until enough customers stop paying, they'll both push for prices that ensure their desired profit margin/market share.
  • meowmix44
    Cable = Bullicks
    Time Warner = Censored rubbish
    XBMC = Brilliant
  • Capm
    You don't realize how much all this stuff really costs. Cable companies ARE in business to make a profit, if they weren't, there would be no point to offering service of any kind - but they get nickle-and-dimed before you ever do. Everything costs money. You have to pay for each channel per sub, per month, to receive it, you get told how you can bundle it into your lineup, and you get forced to carry channels nobody wants. Then you have to pay transport fees every month on every box you put out. You have to pay for the guide software for every box that goes out, every month. You have to pay a fee to a provisioning vender for every account, every month, so that you can control your boxes. Then the boxes themselves cost a small fortune. Most Dual or Quad tuner DVRs are 400-500 dollars each, secondary boxes can be up to 200 dollars each. You can't just give them away, you have to offset that cost somehow.

    Then, you get these broadcasters, that are now charging YOU By Proxy, for something they offer freely over the air. Because no cable company can absorb the cost for what they want paid every month, without passing the cost on to you. So don't blame the cable company for rate increases, blame the programmers and broadcasters, who have all the cable co's by the nutsack, thanks to Congress's Telecom act of 1996.

    TWC isn't just thumbing its nose at CBS in this matter, its risking significant fines from the FCC for shutting off what is likely a "must carry" meaning they don't have a choice but to carry the CBS affiliate. They also cannot refuse to pay CBS either, no matter what they charge. Thats the crux of the problem here, and why this is really a big deal.

  • the_brute
    has toms even said why time warner pulled the plug or is this about why time warner is so bad. The package from cbs has been getting anywhere from 10-15% more expensive EVERY year for the last 6 years. many different tv providers have been looking to make a stand, but time warner is the first mega one to do it. my current one had us blacked out with CBS and FOX for almost a month until both companies decided NOT to raise the prices almost 18% (this happened in fall 2011.

    Meanwhile BOTH companies CBS and TWC showed very (un)healthy PROFIT again this quarter. while charging more and more for their linups.
  • jabliese
    Glad to see your "s" key worked for the last paragraph, but for those that do not know, it is "Moonves"