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Viacom Sues Cablevision Over Live TV App for iPad, Negotiating Settlement With Time Warner

Thursday June 23, 2011 10:49 am PDT by Eric Slivka
Back in March, cable provider Time Warner launched an iPad app that allowed subscribers to the company's TV and Internet services to access live TV from a number of channels via their iPads while on their home Wi-Fi networks. The cable company was forced, however, to quickly pull channels from several content providers who objected to the usage. Disputes with Fox and Discovery were resolved within weeks, while Time Warner filed suit against Viacom over the issue, claiming that its contract did allow the cable provider to broadcast channels such as Comedy Central, MTV, and Nickelodeon to iPads.

Cablevision's Optimum for iPad live TV app

In the meantime, Cablevision launched its own iPad app bringing full access to the cable company's cable lineup as well as on-demand content. In the process, Cablevision took content providers head-on with statements laying out its position that such an offering was allowable under carriage contracts for the various channels.

Things had been quiet for the past several months, but a couple of developments yesterday and today are reigniting the debate. Yesterday, The Wall Street Journal reported that Time Warner and Viacom have placed their legal dispute on hold as they work toward a settlement.
The two companies said in a court filing made public Wednesday that they had reached a "standstill agreement," which put all the litigation on hold as of June 17. "In an attempt to resolve this and other litigation and potential litigation, the parties have entered into a standstill agreement," the parties said in the agreement.

The two companies are currently in talks over whether to return channels like MTV to the Time Warner Cable app, but it is unclear what the outcome of those talks will be, according to people familiar with the matter.
While there may be hope for some sort of resolution for Time Warner, Viacom has actually ratcheted up the pressure on Cablevision, as Reuters reports that Viacom has filed a lawsuit against Cablevision over its live TV app for iPad. The Wall Street Journal provides more detail on the lawsuit:
In the suit Thursday, Viacom said it is "committed to meeting consumer demand for broadband delivery of its programming."

"To this end, Viacom has reached reasonable agreements with several emerging and established digital media distributors so that they can stream Viacom's content and also provide an outstanding user experience.

"What Viacom cannot do, however, is permit one of its contracting partners, Cablevision, to unilaterally change the terms of its contractual relationship," it said in the lawsuit.
Apple's iPad has become a popular way for users to consume video, with streaming video services such as Netflix and Hulu experiencing strong success on the platform. Live television is yet another step forward for iPad video consumption, with some networks such as ESPN putting out their own apps for live video while cable providers such as Time Warner and Cablevision have been attempting to bring a breadth of channel offerings to their customers.

Related Roundup: iPad
Tags: Viacom, Time Warner, Cablevision
Buyer's Guide: iPad (Don't Buy)
[ 38 comments ]


Top Rated Comments

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tasset
104 months ago
Translation: "A provider of our content cannot give away a value-added benefit to their customers, without us first having the opportunity to nickel-and-dime them by charging for the same content twice."
Rating: 6 Votes
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GFLPraxis
104 months ago
I can't believe I am actually rooting for a cable company.

Way to go Cablevision. The results of these lawsuits will be groundbreaking in a lot of areas. Essentially, Time Warner and Cablevision are arguing that the method is irrelevant; they have the license to distribute Viacom content to Time Warner/Cablevision subscribers over cable lines, and are switching from an analog transmission to doing it over IP on the same cable lines. Viacom is arguing that they should have to pay for seperate licenses to send the same content over the same wires to the same customers using a slightly different transmission method.


We should all be hoping for Viacom to get smacked down here, or we'll all suffer.
Rating: 5 Votes
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TheSlush
104 months ago
Oh, get it together, you scared, content-providing morons! People want your stuff! Figure out ways to give it to them, not keep it from them!

Get on the bus or you'll find yourselves under it!
Rating: 5 Votes
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Ciclismo
104 months ago
Whilst the media houses squabble over who gets what piece of the pie, we end consumers, frustrated about not being able to easily consume media when and where we want, will continue to use other methods (such as torrents) to gain access which deny said media corporations of any profit anyhow. Now that is what is called an "own goal".
Rating: 3 Votes
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aristotle
104 months ago
Your congress should pass a law to prevent double billing. As long as the app validates that the user is a subscriber in good standing, they should not be allowed to charge a second time.
Rating: 2 Votes
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tasset
104 months ago

There is always someone propagating the big iTunes myth. Apple has no interest in killing cable. They have no real interest in iTunes as some end all video consumption model. They make little to no profit on anything iTunes whether it be App Store, iTunes music and movies, iTunes rentals. Their 70/30 split is to make enough money to make a marginal profit at best. Less than 10% and probably closer to 5%. iTunes, App Store, all that serves one purpose and one purpose only. SELL HARDWARE. Macs, iPods, iPhones, and iPads. What they generate in revenue and profit on hardware makes the little actual net profit from iTunes pale in comparison. It is a drop in the bucket. But they wouldn't sell nearly the amount of hardware or make the money they do without the content to drive the ecosystem.


I wonder about this. The amount of bandwidth Apple would have to serve for iTunes TV streaming would be astronomical. Maybe in 5 to 10 years? I've heard the 30% they get for a 99c song download is marginally enough to cover costs. And that's roughly 5mb a song. How much would they have to charge to stream an hour of HDTV? But then I think, obviously profitable for Netflix to make it work. So maybe the bandwidth costs are greatly exaggerated.
Rating: 1 Votes
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roland.g
104 months ago

I wonder about this. The amount of bandwidth Apple would have to serve for iTunes TV streaming would be astronomical. Maybe in 5 to 10 years? I've heard the 30% they get for a 99c song download is marginally enough to cover costs. And that's roughly 5mb a song. How much would they have to charge to stream an hour of HDTV? But then I think, obviously profitable for Netflix to make it work. So maybe the bandwidth costs are greatly exaggerated.


Apple sold about $4 billion in Music, Movies, TV Shows and iOS apps combined in 2009, up 21% from 2008, and that figure has undoubtedly risen in 2010 and 2011 YTD. However, the iTunes store is essentially a "break-even business" for Apple. They might net $100 to $400 million in profit or less on $4 billion in sales. However, in the quarter ending end of March 2011, they had $24.67 billion in revenue and $5.99 billion in profit. Now I don't know what part of their quarterly revenue or profit was iTS/App Store, but when you sell 3.76 million Macs and 18.65 million iPhones, that's your bread, butter, and opera tickets. 30% on iTunes, Apps, etc. just keeps that part of the business afloat so they can sell us all that other fun stuff.
Rating: 1 Votes
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rdowns
104 months ago

They do. They just want the cable companies to pay for it. They have to pay additional money to writers, directors and actors as a result too...

Phazer


Why?

If I buy a new TV, it costs me no more to watch content other than the cable box rental. Cable companies pay content providers based on subscribers, not number of TVs.
Rating: 1 Votes
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mchoffa
104 months ago
So I could buy a 10 inch LCD tv and watch my cable on it, and viacom is just fine with that, but not on my 10 inch lcd screen on my ipad? I do not understand how they even have a case here... how are those two different?
Rating: 1 Votes
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adwebinc
104 months ago
I am so sick and tired of the cable companies and movie studios operating with blinders on. Have they learned nothing from watching the music industry?!? I pay a shload of money to my cable company every month, but I can't watch it remotely without cobbling together crap solutions. I own over 300 DVDs, but there is no "legal" way to rip movies that I paid for and own?!? All they do is motivate people to use less than ethical solutions. :mad:

Rant over.
Rating: 1 Votes

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