• by Wendy Davis , Staff Writer @wendyndavis, January 2, 2009

Time Warner Cable and Viacom may have reached a tentative agreement this week but, in the long run, battles between network operators and content companies are bound to intensify as content migrates online.

Viacom channels including MTV, VH1 and Nickelodeon came within hours of going dark on Time Warner on New Year's Day. But at midnight, Viacom and Time Warner agreed to a temporary extension and then eventually reached a deal in principle, according to The Los Angeles Times.

The details have yet to emerge, but The Los Angeles Timesestimates that Time Warner will pay around $39 million, amounting to a 12% increase, for Viacom's cable channels.

Analysts say that both companies stood to lose money if Viacom shows disappeared from Time Warner homes, as Viacom would lose ad dollars and Time Warner would alienate subscribers.

But, while that's true to a point, in the long run Time Warner stood to lose far more than Viacom because Viacom has another distribution channel at its disposal: the Web. Already, many Viacom programs are available online at sites like MTV.com. As long as there's enough bandwidth to transmit video, there's no downside to Viacom to placing more shows online.

Time Warner, meanwhile, can only lose subscribers as people realize there's no reason to pay for TV shows they can get for free online. Already, there's reason to believe that customers looking to save money are more likely to chop cable from their budgets than Web connections -- which are increasingly viewed as necessities.