April 07, 2011

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We Filed A Request For Declaratory Judgment With Viacom This Afternoon

Last week, we pulled a number of channels from our iPad app. The Internet – not exactly a haven for measured discourse or patience for complex ideas – lit up with verbiage more commonly found in war movies and interviews with professional wrestlers.

Ultimately, we are very confident in our rights to distribute our programmers’ feeds over our cable distribution infrastructure to any digital device within our customer’s home. And some of our programming partners have taken the position that our interpretation is wrong.

We are confident enough in our interpretation of our rights that we are willing to take the matter to court. We’ve issued a release to that effect today – please see below:

Time Warner Cable (NYSE: TWC) today announced that it has filed a request for declaratory judgment relating to Viacom cable networks. The request asks the court to rule that Time Warner Cable’s rights under its carriage agreement allows it to deliver the programming of this company over its cable systems for viewing on devices of its video customers’ choosing, including iPads, in their homes. The case was filed in the United States District Court for the Southern District of New York.

Marc Lawrence-Apfelbaum, Executive Vice President and General Counsel of Time Warner Cable said, “We have steadfastly maintained that we have the rights to allow our customers to view this programming in their homes, over our cable systems, without artificial limits on the screens they can use to do so, and we are asking the court to confirm our view. With over 360,000 downloads of our TWCableTV™ app, it is clear that our customers welcome the convenience and flexibility our new app provides.”

The app, which launched to customers on March 15, 2011, currently features 43 channels which are available to customers whose subscriptions include them. For a list of the channels currently available and updates on the app, please visit www.twcableuntangled.com, the company’s blog.

To be completely clear: this is not a hostile lawsuit. It’s a request for a declaratory judgment.

We’re at an impasse with a handful of network owners, and we need an impartial third party to referee the situation and confirm that our interpretation is correct. We thought the most efficient way to settle this would be to go before a judge and ask for a decision that, while noncombative, would establish the rights that we bargained for.

If we weren’t completely certain that we had the rights to distribute television to our customers’ iPads within their homes, we wouldn’t be asking for the court’s attention. Of course we want our customers to know about this, but we also want to make sure that everyone understands that this is not combat. Destruction and resolution are two very different things, something that gets overlooked a lot in public these days.

We’re moving towards an efficient and hopefully dignified resolution. And once we get there, we’ll let you know.

+- 15 Comments

  1. Adam Black's reply

    I retract my previous statement about TWC needing to grow some balls after Cablevision released their app and basically told providers to come at them. You guys rock… step in the right direction!

  2. BobE's reply

    Good does that mean we can use anything we want instead of DVR’s on Time Warner now?

  3. Jeff Simmermon's reply

    @BobE – How are you even drawing that conclusion here? This is about streaming on the iPad.

  4. Glenn's reply

    Good for you. This is how somebody who believes what they say in public acts. I was worried that you were just caving in based on receiving a few letters, which isn’t how we expect you to act to defend OUR rights. But this is more like it.

    Personally I think you got all those letters while Cablevision has not (maybe) is because of their willingness to go to court, and their history of winning these sorts of lawsuits with media companies.

    Hopefully, you’ll find the same freedom with this new approach.

  5. Jonah Burke's reply

    Jeff: Maybe BobE is reaching that conclusion because you are couching your argument in terms of what customers want. Bob wants to use a device other than your officially sanctioned DVR to enhance his viewing experience. To put it in the terms of your prior post, have you ever gotten a complaint from a customer saying, “I would like you to prevent me from using a recording device”?

    Moreover, I’m surprised you disparage the entire Internet as “not exactly a haven for measured discourse” while characterizing programmers as unenlightened, feeble crybabies. (And by the way “kicking the currents with feeble karate” is just one metaphor too many!) The programmers are businesspeople with their own interests, just like you. If you want to reach an agreement, start with respect.

  6. Bryan's reply

    It sounds like Jeff needs to reply to Jonah…but the bigger question is:

    If the pretense of TW’s argument is that they have rights to distribute their content under their contracts however they want, why dont they also stream it online and directly compete with sites like hulu? Or create a widget for xbox to stream through there?

  7. Gary McKoy's reply

    I’m very proud of you right now TimeWarner!!! Thank you for standing up to the Greedy networks. If they aren’t allowed to charge us for getting a new tv then why should they be allowed to charge us for getting an iPad?

  8. Steven's reply

    All this effort to go against the wishes of content providers by streaming their content to iPad… and we’re STILL waiting on ESPN3 on Xbox.

    “Ultimately, we are very confident in our rights to distribute our programmers’ feeds over our cable distribution infrastructure to any digital device within our customer’s home.”

    Great, there’s an Xbox360 in your customers home just dying to have American LeMans races on it via ESPN3…. make it happen already.

  9. RJ's reply

    ESPN3? Steven, ESPN launched an app the other day to watch on your phone….and then the iPad app is hitting nxt month I believe. Its called WATCHESPN. Check it out, very solid.

    Jeff. I’ve been critical in the past re: TWC but I love the quick action your taking on this app.

    Good work.

  10. Keith's reply

    >>The request asks the court to rule that Time Warner Cable’s rights under its carriage agreement allows it to deliver the programming of this company over its cable systems for viewing on devices of its video customers’ choosing, including iPads, in their homes.<<

    Great. I want the HD channels currently available on your iPad app (and those previously available but yanked) on my HDTV, not just my iPad, but they somehow never made it to my actual cable TV lineup. Why can't you make that happen?

  11. Hans Felsh's reply

    Wow, what a bunch of TWC fanboi’s posting here! Sheesh. :disgust: First and foremost, I’m a former TWC employee (before it split and became Bright House Networks aka BHN here in Tampa Bay.)

    Sorry, TWC – you WILL lose this “non-hostile lawsuit” – which, frankly, is one of the biggest loads of BS statements I’ve read in a long time. You, as a company, have the rights to distribute cable channels to a TV – that’s “television” device. You *do not* control the internet, nor computers (including desktop, laptop, and other devices like the iPad), nor even smartphones such as the iPhone or any Android phone. Your argument is akin to ANY radio station complaining that you, as a “cable content provider”, also have MUSIC CHANNELS, and they, as radio stations, have the “exclusive right to distribute music to it’s listeners.” Which, of course, it ludicrous.

    Furthermore, let me quote your EXACT wording, and tell you why any judge with even ONE brain cell left will laugh this out of court:

    “The request asks the court to rule that Time Warner Cable’s rights under its carriage agreement allows it to deliver the programming of this company over its cable systems for viewing on devices of its video customers’ choosing, including iPads, in their homes.”

    1. “…to deliver the programming of this company over its cable systems” – that’s all well and good. BUT, the iPad has *nothing* to do with a cable system. ESPECIALLY if said customer is using 3G cellular service (not WiFi) to connect and watch whatever they want.

    2. “…of its video customers’ choosing…” – uh, yeah. So, by TWC trying to BLOCK a different company’s app, TWC is NOT allowing it’s “video customer’ choosing”, but instead wants to FORCE their customers to ONLY use/view what TWC says they can. Isn’t that the exact OPPOSITE of what you’re saying?

    3. “…in their homes.” Great. So…does that include the backyard, whilst someone is laying in their hammock? What about if they’re at the beach/dog park/et. al? What then? Are you saying that just because someone happens to have TWC “in their home”, that while they’re NOT at home they STILL can’t use any of your competitors? How exactly will you determine this? (I can just see it now: “GPS coordinates indicate that you are inside your home, where you are only allowed to watch TWC. Please move at least 300 yards away from your current location in order to view this…”

    Finally, what about customers who, say, happen to have both TWC *and* Dish Network? Will you be going around to each of them, forcing them to choose one company over the other? (Yes, I know several people who have this type of setup.)

    Just because someone is paying for your (overpriced) “service”, doesn’t mean that they can’t use a DIFFERENT service at the same time. You don’t have to like it – obviously you don’t – but there isn’t one d*mn thing you can do about it. PERIOD. Whining and crying to a judge that “your interpretation is correct” only makes you look like a bigger fool. Bottom line: you DO NOT control what any user watches on anything other than what they plug into your coaxial cable jack. WiFi? Internet? Nope, sorry – you do not control it, you cannot control it, and you will lose any fight to TRY to control it.

    This boils down to ONE thing, and one thing only: NET NEUTRALITY. Where do you draw the line? If, by some OUTLANDISH chance (and believe me, TWC is probably going to try to take this to the Supreme Court) TWC was to “win” this, then what? A precedent has been set; now that TWC can “block” the use of said app, that opens the door to allowing them to block other data traffic, if they deem it to be their “exclusive right” – like, say, Hulu, or maybe even YouTube.

    No, I’m not joking. But seriously? Time Warner Cable, you certainly are. I can’t believe you actually have lawyers who thought this has one snowflake’s chance in Miami of this actually getting ANYTHING but bad press, much less a verdict in your favor.

  12. Jeff Simmermon's reply

    Keith,

    I see why you would feel the way you do – the answer is much more complicated than a single comment reply, however. Part of it really depends on the television channel and our relationship with them – whether we are contractually allowed to offer the channel in HD and what the costs of doing it are versus the demand. Unfortunately I’m not part of those discussion. Another part of the issue has to do with bandwidth. HD channels take up much more bandwidth on a cable coax line than Standard-Def channels. Usually when we shuffle channel lineups we are doing it to free up bandwidth for HD channel additions, for example. We are moving to SDV (switched digital video) in an attempt to free up some HD bandwidth as well.

    However, when the channels are streamed over the iPad, they’re not a part of the DTV spectrum and are instead running over our broadband network. It’s much easier to offer HD streaming video than an HD tv channel.

    This is a back-pocket explanation and may have some holes in it. I’d like to take some time and research this further and present a better answer in a full blog post in the future.

  13. Jeff Simmermon's reply

    Hans – this is … dense. Do you have the iPad app for yourself? It just doesn’t work if you’re not a cable sub and a broadband sub and on your home network. It’s not some maniacal attempt to limit your freedoms, it’s just how it works. We don’t want to violate our agreements with programmers, so we are keeping these signals on our network. If you’re outside the range of your home modem, it doesn’t work. We never said anything about blocking the use of any apps, or block data traffic. Just try to breathe deeply, man. Seriously.

  14. Keith's reply

    @Jeff, we already have SDV here and it’s running, and the HD channels in question are already available (and have been for a long time) on other TWC districts in the Los Angeles system.

  15. Dakota's reply

    SDV drives me nuts and it makes me feel like I’m being monopolized into taking a TWC cable box or DVR and not getting alternative solutions since it’ll cost me the same as a box to get the card and a tuning adapter (if our local office even has those – apparently the 4640s are being reserved for SignatureHome and we couldn’t get a new box) – and if I wanted a TiVo I’d be paying even /more/ than a TWC DVR to have a choice, which sucks.

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