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CBS Extends Verizon FiOS Deal, as Time Warner Cable Blackout Continues

Three-year pact covers telco’s retransmission of local stations in N.Y., L.A. and Dallas, expands CBS Sports Network carriage

As Time Warner Cable has refused to budge on CBS’s distribution demands, cable rival Verizon Communications has agreed to pay the Eye to keep its stations on the air for three more years.

CBS struck three-year deal with Verizon to extend carriage of CBS-owned stations, including the Eye’s locals in New York, L.A. and Dallas, on the telco’s FiOS TV service. More than 3 million TW Cable subs in those same markets lost access to CBS-owned stations on Aug. 2, and cable operator also pulled Showtime and other nets nationwide.

Terms of the deal were not disclosed. CBS has been seeking higher retrans payments from operators, and broadcaster has said it anticipates that revenue to double in 2012.

In a memo to CBS employees distributed to the media, topper Les Moonves said broadcaster obtained “fair value for our over-the-air rights, while preserving our streaming rights as well.” He added that Time Warner Cable “has been offered almost exactly the same deal for CBS carriage to which Verizon has agreed.”

SEE ALSO: CBS Consumer-Perception Score Goes Negative as Time Warner Cable Blackout Drags On

CBS is trying to show that Time Warner Cable is the lone standout among pay TV operators in refusing to deal with the Eye. The deal with Verizon was “swiftly and amicably in just a few days after our conversations began,” according to Moonves. “In many aspects of the deal, Time Warner Cable is demanding different terms than any other company in the business. I am frankly mystified by what appears to be a lack of urgency to resolve this matter for their customers.”

Time Warner Cable declined to comment on Moonves’ remarks.

Under CBS pact with Verizon, about 3.5 million FiOS TV customers will continue receiving CBS-owned stations. Telco also has rights to provide CBS programming via video-on-demand, for no additional cost to subs.

For its part, Verizon is aiming to signal to existing and prospective subscribers — including disgruntled Time Warner Cable customers — that the telco is not inclined to engage in feuds that result in programming blackouts.

“We’ve reached this agreement in partnership with CBS for our customers, so that they may continue to enjoy CBS content on FiOS,” Terry Denson, Verizon’s VP of video content and strategy, said in a statement. But telco also continues to seek reform of current retrans rules, as Denson noted, “Verizon continues to address areas of change where necessary in current policies to better reflect the interests of consumers.”

Deal also widens carriage of CBS Sports Network on FiOS TV, which has about 5 million video subscribers nationwide. Verizon has existing agreement with CBS to carry Showtime Networks and Smithsonian Channel that will “continue in the years to come,” companies said.

SEE ALSO: CBS, Time Warner Cable Reach Pact to Air NYC Debates

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