Commentary

Time Warner Cable And Viacom Reignite iPad Court Battle

The Pax Viacoma is over. Viacom and Time Warner Cable have reignited their court battle after failing to reach a settlement in their dispute over in-home iPad streaming.  

An apparent driving force is a deal Viacom reached with another cable operator, Cablevision, on effectively the same matter. Time Warner Cable (TWC), in turn, feels it is entitled to similar terms.

In June, Viacom and TWC agreed to put their iPad battle in New York federal court on hold, while they hoped to work out a solution. In a recent government filing, however, TWC said it ended the temporary truce in October.

TWC maintains it has rights to simulcast Viacom networks such as MTV, Comedy Central and Nickelodeon on iPads in the home (which it stopped doing in March). Viacom argues that distribution is a breach of contract and brings copyright and trademark violations.

Viacom and Cablevision reached an August settlement on their stand-off similar to the Viacom-TWC matter. Viacom had sued both TWC and Cablevision to prevent them from iPad simulcasting its programming.

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TWC now says in court papers that it is entitled to the “identical rights” Viacom granted to Cablevision. TWC also says it can “terminate” certain Viacom services (MTV2 and VH1 Classic) and “cease paying significant license fees” for them if it does receive its desired arrangement. 

In a statement announcing their settlement, Viacom and Cablevision said the deal involved the iPad issue and “an unrelated business matter.” It is possible that gave TWC the idea to bring its own unrelated issue into its battle with Viacom. 

TWC has now expanded its case to include charges that Viacom violated a contract by moving the focus of its CMT network away from country music. In court papers, TWC says that CMT has “all but ceased” offering programming related to country music in key time periods. Instead, it says the network has shifted to largely unconnected reality TV, series and movies.

TWC says CMT has some rights to “control” its schedule, but not to “materially deviate” from its programming focus back in 2004.

TWC charges that CMT’s makeover has “acutely” impacted the diverse programming line-up it seeks to offer customers. Also, it says much of CMT’s programming “originated” on other networks, leaving TWC to pay for essentially the same programming twice.

In all likelihood, the CMT claim is an attempt by TWC to ratchet up pressure on Viacom to settle the iPad matter. (It would be unlikely CMT would swap “Dallas Cowboys Cheerleaders” for music videos.)

Undeniably, Viacom wants compensation (or other benefits) to allow TWC to go with iPad streaming. In court papers, Viacom cites several times when TWC amended agreements to give it added rights such as offering HD feeds. And each time, TWC gave Viacom “additional consideration.”

What is interesting is Cablevision took a much more aggressive stance than TWC in the spring. While Viacom complained about its networks on both of the TWC and Cablevision iPad apps, Cablevision opted not to remove them.

TWC opted to remove the networks by April 1 -- two weeks after it launched them -- even as it felt it had rights to offer them. 

TWC says its iPad app was downloaded 1.5 million times between March 15 and June 30. Networks offered stretch from A&E to the Discovery Channel to MSNBC to the Food Network.

TWC contends it has rights to offer programming on multiple devices in homes, including iPads and “Smart TVs.” Regarding Viacom and perhaps other networks, TWC argues in court papers that as it realized the new distribution options were coming, it “intentionally obtained” platform-neutral rights.

TWC says the iPad allows viewing of the same programming people “subscribe to and have paid for" and that it has "handsomely paid Viacom" to make available.

One reason Viacom objected to TWC’s iPad streaming, according to court filings, is Nielsen does not measure the programming stream and it could lose advertising dollars.

Nielsen is working on offering a measurement system. For now, though, Viacom presumably has gotten over it vis-à-vis Cablevision.

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