News Corp.’s Fox Broadcasting has backed off its threat to pull several of its newly acquired TV stations from Time Warner’s cable systems on Jan. 1 – a move that might have deprived more than 1 million cable viewers of Fox’s NFL playoff and Super Bowl coverage.

In a statement released Wednesday, News Corp. said it has reached an agreement with Time Warner to continue retransmission of Fox fare on the New World Communications Group stations being acquired by Fox.

There are several issues under debate between Fox and Time Warner; they involve the New World stations, as well as News Corp. topper Rupert Murdoch’s battle with Time Warner to get clearance for the new Fox News Channel.

Fox had claimed that Time Warner must renegotiate retransmission rights for the New World stations by Jan. 1, which is when Fox expects to close the deal to acquire New World. The stations in question are in Tampa, Fla.; Kansas City, Mo.; Milwaukee; Austin, Texas; and Detroit.

Time Warner argued that although the New World stations had signed retransmission agreements before they were affiliated with (and subsequently bought by) Fox, the cable giant’s 1994 agreement with Fox stipulated that any TV stations acquired by Fox in markets where Time Warner has cable systems would automatically fall under the existing TW-News Corp. contract.

News Corp. says no such clause exists in its original retransmission consent deal with Fox, and that the New World stations need to have new deals. Time Warner execs say Fox was threatening to pull the New World stations only as a bargaining ploy to try to force Time Warner Cable into putting the Fox News Channel on its cable systems. Fox denies the allegation.

While the New World stations will remain on Time Warner cable, the TW-News Corp. dispute is far from resolved. Time Warner filed suit earlier this month in Tampa.

In a statement, Time Warner said it is “confident the court will agree with us that our existing Fox contracts give Time Warner Cable the right to continue carrying Fox signals from the stations they are purchasing from New World. It remains to be seen whether this first step will lead to a solution of our fundamental differences with Fox over our retransmission consent agreements.”

Fox Television chairman and CEO Chase Carey said Fox didn’t want to drag viewers into its battles with Time Warner. That seems to be a change of heart, considering that Fox had run ads in several of the New World markets warning that the signal may be pulled from cable as a result of the spat, and advising viewers to make sure their old TV antennas worked.

While Fox has backed off the threat, the company reiterated that it believes it is in the right with regard to renegotiating the New World retransmission consent deals.

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