You will be redirected back to your article in seconds

Pay TV Ops Set Conditions on Cable Nets in Inking Internet Video Pacts

TWC, DirecTV, Dish and Cablevision have some programming contracts that discourage over-the-top TV deals, sources say

Pay TV providers including Time Warner Cable, DirecTV, Dish Network and Cablevision Systems have certain carriage agreements that effectively discourage programmers from cutting deals with Internet TV providers, according to industry sources.

But the distributors claim the real issue is that they simply want the same multiscreen-video terms as new entrants.

TWC CEO Glenn Britt, during a session with Wall Street analysts Tuesday at the 2013 Cable Show, said the cable operator “may well have (programming contracts) that have that prohibition” barring TV networks from distributing their services to online video providers. He added that some deals afford TWC the rights to nationwide Internet-video distribution if programmers license networks to an online video provider.

“This is a not a cookie-cutter kind of business,” Britt told the audience, adding that Time Warner Cable has roughly 300 different deals with content providers.

A rep for TWC declined to provide additional comment; Cablevision also declined to comment. Bloomberg earlier reported the use of such contract provisions by Time Warner Cable and others.

A DirecTV spokesman declined to discuss the issue but said, “We just want fair and equal treatment across the board.”

Dish also said it could not address specific terms in programming deals, which the satcaster said are confidential. But a rep said in a statement that “we have always believed that the consumer should come first and have fought for the right to provide content in alternative, consumer-friendly ways.”

Generally speaking, under “most favored nation” clauses in programming deals, cable and satellite ops are entitled to receive the same or similar terms and conditions that networks extend to others.

Even if those contractual provisions really are intended to keep pay-TV incumbents on equal footing with respect to video distribution to Internet-connected devices, the restrictions may make it difficult for “virtual cable operators” to obtain rights to TV networks. Intel has announced plans to launch an Internet-delivered television service later this year, and Sony and Apple are rumored to be entertaining the idea.

In some cases, pay TV operators’ agreements essentially prohibit programmers from distributing their TV services to OTT providers because the larger distributors have the right to drop networks from the lineup unless they are extended the same rights, according to sources. Other deals are structured with financial incentives, offering cablers better per-subscriber rates if a programmer agrees to withhold content from online video providers, sources said. It’s unclear how common these approaches are.

Large media companies have the clout to push back against the most restrictive demands from incumbent pay-TV providers. But small and midsize cablers often don’t see an alternative to accepting the terms, according to an industry exec familiar with the situation.

The issue of such restrictive clauses in programming deals was called to light by BTIG Research analyst Rich Greenfield, who suggested in a blog post Tuesday that such provisions may be illegal. He wondered if the Federal Trade Commission should investigate them.

“We hope programmers who have been forced into signing these anti-competitive MVPD contracts make public that they are unable to license their content to non-facilities based distributors,” he wrote.

At the analyst session at the Cable Show, Charter Communications CFO Christopher Winfrey declined to get into the specific terms of its programming deals as they relate to over-the-top providers. However, he said, it is in “everyone’s mutual interests that we are protecting the ecosystem… and the way (programming) is delivered to our subscribers today.”

Currently, Comcast and NBCUniversal are the only pay TV players that are legally obligated to deal equitably with OTT providers. Under the FCC’s January 2011 approval of Comcast’s deal for the media company, NBCU is required to offer video programming to “legitimate (online video distributors) on the same terms and conditions that would be available to an MVPD (multichannel video programming distributor).”

Amid the rise of over-the-top video options, pay TV ops have been aggressively trying to extend TV services to alternate screens — both inside and outside the home.

For example, Time Warner Cable’s TWC TV apps provide live TV channels and video-on-demand on Apple iOS and Android devices, PCs and Macs, and Roku set-tops. This week, the operator said that starting this summer customers will be able to watch up to 5,000 VOD titles directly on Samsung Smart TVs.

Also this week at the Cable Show, Comcast announced Xfinity Cloud TV, which will provide live channels and DVR recordings to tablets, smartphones and computers, though the service will be largely restricted to at-home viewing.

More TV

  • Baby Yoda The Mandalorian

    Disney Plus Set for Earlier Launch in U.K. & Western Europe

    The Walt Disney Co. has set March 24 as the new launch date for Disney Plus in the U.K. and other key markets across Western Europe. With the roll-out previously set for March 31, the streaming service will now be available a week earlier in the U.K., Ireland, France, Germany, Italy, Spain, Austria and Switzerland. Pricing [...]

  • 9-1-1: LONE STAR: L-R: Rob Lowe

    TV Ratings: '9-1-1: Lone Star' Starts Strong Behind NFC Championship Game

    “9-1-1 Lone Star” got off to a flaming start for Fox in the TV ratings behind the NFC Championship game. The Rob Lowe-fronted series premiere to a 3.2 rating among adults 18-49 and 11.5 million viewers in the time zone-adjusted ratings, which represents easily the best scripted debut of the 2019-2020 season. “Lone Star” had [...]

  • Ariel Winograd'TOD@S CAEN' film premiere, Los

    Viacom International Studios Signs First Look Deal with Ariel Winograd (EXCLUSIVE)

    MADRID  — Adding to a powerful and still growing talent roster, Viacom International Studios (VIS) has clinched a first-look deal with Argentine writer-director Ariel Winograd whose latest movie, “The Heist of the Century,” has just become one of the biggest Argentine openers in history. The multi-year pact takes in the development and production of not [...]

  • William Bogert Dead: 'Small Wonder' Actor

    William Bogert, Who Appeared in 'War Games,' 'Small Wonder,' Dies at 83

    TV, film and theater actor William Bogert, who appeared in a recurring role on 1980s sitcom “Small Wonder” and in films such as “War Games,” died Jan. 12 in New York. He was 83. On “Small Wonder,” which ran from 1985 to 1989, Bogert played Brandon Brindle, the Lawsons’ neighbor and Harriet’s father who became [...]

  • Editorial Use OnlyMandatory Credit: Photo by

    TV Ratings: NFL's AFC, NFC Championship Games Down From 2019

    The NFL’s AFC and NFC championship games made for a blockbuster Sunday of football for CBS and Fox, but viewership of the games that determine the contenders for the Super Bowl was down from 2019 levels. CBS’ AFC championship in the 3 p.m. ET afternoon slot delivered 41.1 million viewers as the Kansas City Chiefs [...]

More From Our Brands

Access exclusive content