CBS, Time Warner In Digital Deal
CBS and Time Warner said Tuesday that the digital signals of CBS's 14 owned-and-operated televisions stations will be carried on Time Warner Cable systems in CBS markets around the country.
The deal between the two companies is the first such agreement between a major cable operator and a broadcaster. Financial terms weren't disclosed.
Time Warner's cable arm will provide the CBS digital feed to systems that have already been upgraded to receive those signals. The operator says 70 percent of its customers will be able to get digital signals by the end of this year, almost all of them by the end of 2000.Time Warner Cable will also occasionally carry certain special CBS programs, such as NFL Football, across an entire cable system in HDTV format, including areas not yet upgraded.
Some cable chieftains - most notably John Malone of TCI - have balked at the idea of possibly being forced by the FCC to carry broadcasters' high-definition digital signals, which take up a lot of space on the digital spectrum. They've said they'd rather use that space to carry more premium channels or other ancillary services. Broadcasters argued that too many viewers simply wouldn't be able to see their HDTV telecasts without cooperation from cable.
Tuesday's agreement might suggest a way to alleviate concerns on both sides.
Joseph Collins, chairman and chief executive of Time Warner Cable, said in a statement that his unit "is a strong believer in HDTV," and he's convinced that the CBS pact "will serve as a model for the rest of the industry."
CBS (CBS) shares edged 1/8 lower to 31 3/16, while Time Warner (TWX) stock rose 1 3/16 to 109 3/16. (CBS is a 50-percent owner of CBS.MarketWatch.com.)
Jonathan Klein, president of CBS Television Stations, said: "If digital television is to flourish, broadcast television and cable companies must work together to make sure that the signal makes it to the people who really count - our viewers."
Written By David B. Wilkerson