By Ed Oswald | Friday, March 25, 2011 at 2:10 pm
Time Warner Cable is standing its ground in an increasingly bitter fight over its rights to transmit TV networks carried over its television service as it sees fit. The issue here is the company’s iPad app, which would all but turn the tablet into another TV capable of showing live programming.
This has the television networks in a tizzy, claiming that their contracts with the cable provider do not give it the right to essentially stream its content. About 32 cable channels are provided through the service, including MTV, HGTV, Discovery, and others.
Central to Time Warner’s argument is that the networks’ signals aren’t being just blindly transmitted over the open internet where anyone could attempt to snoop — the 21st Century equivalent of stealing your neighbor’s cable. Instead, it says the signals would be transmitted over its own “secure network.”
No doubt this is going to be quite a fight, and if the networks were moved enough, they could cut Time Warner’s traditional cable customers off in retaliation. It’s not that easy a decision though: if they do that, the cable company is under no obligation to pay them the lofty carriage fees that these networks all but live off of.
The question really becomes whether or not Time Warner is within its rights to do so. The cable providers — and the networks, too — have looked the other way while companies like Sling have already done what Time Warner is planning to do. I guess the only difference here is what it is doing could potentially be on a much larger scale.
Indeed, the cables pay some $30 billion annually in carriage fees — but these deals were negotiated long before tablet devices came into vogue. If Time Warner wants to stream TV networks’ signals, it should negotiate that option.
My feeling is that if this goes to court, the TV networks are going to have the upper hand. I think Time Warner knows this too, and I somewhat expect to see some type of talks between the two sides if the cable provider is serious about providing this feature for its customers.