Time Warner Cable Drops CBS for Few Minutes as Talks Go On

Time Warner Cable pulled the plug on CBS channels in New York City, Los Angeles and Dallas/Fort Worth Monday night, but for only minutes before turning the network back on, as the two companies continued to squabble over cable fees.

Sources told the Hollywood Reporter that talks bogged down on Monday, leading the cable operator to announce it would block out the Smithsonian Channel and pay channels Showtime, TMC, Flix along with the signals for the CBS local stations in New York, Los Angeles and Dallas/Ft. Worth.

The networks were back on as quickly as they were off, with Time Warner issuing an announcement that negotiations were continuing.

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"At the request of CBS, we have halted going dark on their channels," said a Time Warner press statement obtained by the Hollywood Reporter. "I'll update you when I have more information I can share. Thanks very much for your patience everyone."

In an update at 5 a.m. ET Tuesday, a Time Warner spokesperson said  the two companies had agreed to an extension until Friday 5 p.m. ET while negotiations continue.

CBS News reported that 3 million customers were affected. Time Warner has complained about what it calls "outrageous demands for fees" by CBS, according to CBS News.

"We offered to pay reasonable increases, but CBS's demands are out of line and unfair -- and they want Time Warner Cable to pay more than others pay for the same programming," Time Warner Cable said in a statement, according to CBS News.

CBS accused Time Warner Cable of having a "short-sighted, anti-consumer strategy."

The Associated Press reported that the continued disagreement revolves around how much Time Warner Cable pays for the right to retransmit signals from the CBS-owned stations.

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"As we've said, we feel like we should be paid for our programming," CBS chief executive Les Moonves told the AP at the Television Critics Association meeting Monday before the temporary blackout.

Selling retransmission rights is a major revenue stream for broadcast networks. Research firm SNL Kagan told the AP that it estimates retransmission fees will reach $3 billion industry-wide this year and will double to $6 billion by 2018.

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