CBS Corp. has reached a new distribution agreement with communications giant Verizon, avoiding a contentious feud like the one the broadcasting company has been waging with Time Warner Cable.
The new three-year pact, unveiled Thursday morning, covers retransmission consent for CBS-owned television stations. Verizon also agreed to provide the cable channel CBS Sports Network to more of its Verizon FiOS TV customers than it had previously.
Financial terms of the agreement were not disclosed.
"This important deal was reached swiftly and amicably in just a few days after our conversations began," CBS Corp. Chief Executive Leslie Moonves said in an email to CBS employees Thursday that appeared to be a not-so-subtle dig at Time Warner Cable. Moonves went on to say that CBS had offered Time Warner Cable almost exactly the same deal that Verizon accepted.
"In it, we achieve fair value for our over-the-air rights, while preserving our streaming rights as well," Moonves said.
CBS local-station signals were yanked off Time Warner Cable systems in Los Angeles, New York and Dallas nearly three weeks ago after the companies, despite weeks of negotiation, could not come to terms on retransmission fees paid to CBS.
About 3 million Time Warner Cable homes have been subject to the CBS station blackout. Verizon FiOS TV service is a major competitor to Time Warner Cable. Verizon's new deal with CBS gives the telephone company a marketing pitch to try to woo disgruntled Time Warner Cable subscribers. CBS said Verizon has nearly 3.5 million subscribers who live in regions where CBS owns a television station.
Verizon FiOS TV service has approximately 5 million subscribers across the country. FiOS TV also will continue to provide CBS programming through Verizon’s video-on-demand services to all subscribers at no additional cost.
CBS and Verizon have a separate existing agreement for FiOS to carry Showtime Networks and the Smithsonian channel.
Moonves told employees in the memo that negotiations were continuing with Time Warner Cable but he sounded exasperated about the process.
"I cannot describe to you the frustration I feel at the way these negotiations have gone," Moonves wrote. "Never in my most pessimistic moments did I ever think that they would have lasted this long and have been so difficult. ... I am frankly mystified by what appears to be a lack of urgency to resolve this matter for their customers."
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