[opendtv] News: New Cable Fight at Hand
- From: Craig Birkmaier <craig@xxxxxxxxx>
- To: OpenDTV Mail List <opendtv@xxxxxxxxxxxxx>
- Date: Sat, 26 Mar 2011 13:03:28 -0400
http://online.wsj.com/article/SB10001424052748703784004576220503287814250.html
TECHNOLOGY
MARCH 25, 2011
New Cable Fight at Hand
TV Networks Cry Foul as Time Warner Cable Offers Channels via iPads at Home
By SAM SCHECHNER
Time Warner Cable Inc. is digging in its heels in a dispute with
several big media companies over whether it can beam live TV channels
to Apple Inc. iPads, exposing tensions between major TV-industry
players as they wrestle with how to adapt to the Internet era.
Melinda Witmer, chief programming officer for Time Warner Cable, said
in an interview that her company is "well within our rights" to
transmit TV channels to any device in the home, as long as it sends
signals through its cables and its "secure network," rather than the
"open Internet." For that reason, the app is specifically configured
to work only when linked to a subscriber's home Internet connection.
Ms. Witmer's comments are the latest salvo in a fight that erupted
last week when Time Warner Cable, without securing permission,
released an iPad app that includes a lineup of 32 live channels that
the cable-service provider carries on traditional TV. Those channels
include MTV, Discovery Channel and Food Network, among others.
Several media executives shot back quickly. HGTV owner Scripps
Networks Interactive Inc. said it had "not granted iPad video
streaming rights to any distributor" and added that it is addressing
"any misunderstandings." Viacom Inc., which owns MTV, Discovery
Communications Inc. and others contended the service violates their
contracts, according to people familiar with Viacom's and Discovery's
thinking.
At issue are interpretations of provisions within the tightly
negotiated- and lengthy-agreements between media companies and cable
operators. Several TV executives say their contracts specifically
delineate rights for "cable television."
One executive contended that distributors have rights only to what is
specifically granted in their contracts. Another executive described
Time Warner Cable's move as a "land grab."
Ms. Witmer disputed those characterizations. "We don't define in our
contracts what a viewing device is, because technology has always
been evolving," she said. "I don't know what a TV is anymore. It's
kind of an anachronistic term."
The contractual dispute over the new app exposes broader tensions
between TV networks and the distributors that pay them more than $30
billion a year in subscription fees, as both sets of companies
attempt to chart a perilous digital course.
Pay-TV providers like Time Warner Cable are moving to counter a
threat in the proliferation of new devices, from tablet computers to
Internet-connected TVs, that can pipe high-quality video to consumers
without a cable or satellite subscription.
Many are rushing to offer video on these devices over the Internet-a
concept dubbed "authentication" or "TV Everywhere"- but have been
bogged down in some cases by the slow pace of securing Web rights to
content.
Time Warner Cable believes its app sidesteps the need for additional
rights, while addressing a pressing need to keep up with the way
viewers consume TV. Ms. Witmer said the company is planning to expand
the app to its full lineup of channels, and to build apps for other
devices including connected television sets.
"It is very important that we be there as a provider," she
said.Cablevision Systems Corp. appears to take a similar view. It has
said it plans to launch an even broader service for in-home streaming
to Internet-connected devices, including all of its traditional
services such as video-on-demand, in coming weeks.
Meanwhile, TV executives have reason to be wary. Some executives see
an opportunity to make more money by selling shows and networks to
companies like Apple and Netflix Inc. over the Web. They aren't eager
to give those rights to cable operators without additional
compensation.
Viacom recently cut a lucrative deal to put shows including Comedy
Central's "The Daily Show" and MTV's "The Jersey Shore" on Hulu.
(Hulu's owners include News Corp., Comcast Corp.'s NBCUniversal and
Walt Disney Co., each of which own TV networks that are streamed
within Time Warner Cable's app. News Corp. also owns The Wall Street
Journal).
Some TV executives say the app could cost them. One said that TV
networks don't always buy broadband rights to their own TV shows and
could be sued by the shows' owners for allowing them to appear within
Time Warner Cable's app.
Other media executives worry that encouraging viewers to watch on
iPads could train a new generation to eschew TVs-and potentially
never sign up for cable and satellite subscriptions that often bring
in half TV networks' revenue.
Time Warner Cable's iPad app also raises another concern for TV
networks: counting viewers who watch their programs on new devices.
Nielsen doesn't currently include viewing on the iPad in standard TV
ratings. A spokesman said the company is "working on a solution to do
so."
Write to Sam Schechner at sam.schechner@xxxxxxx
Read more:
http://online.wsj.com/article/SB10001424052748703784004576220503287814250.html#ixzz1Hj4IcKT1
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