When companies enter into a contract, they agree to look after their partnership the best they can while still keeping an eye on their own best interests. As the terms of the contract expire, it’s hoped that any new demands made by both parties are deemed reasonable so that the contract can continue, especially if it’s been a mutually beneficial relationship that also extends to the respective companies’ customers. If and when contract disputes in Houston do arise, it’s often those customers that are the most affected.
Such is the case with the recent contract negotiations between Time Warner Cable and CBS. The two entities have been battling over retransmission fees since their contract ended in June. Those fees represent the amount that the cable company pays the TV network to provide the station to its customers. Representatives from the cable giant say that the network had asked to raise fees significantly above the already $0.88 per subscriber that it’s estimated that Time Warner paid under the previous agreement, which would force them to raise customer rates to accommodate the increase.
The contractual impasse has now resulted in Time Warner actually pulling CBS from its airwaves, along with its sister network Showtime. CBS maintains that the cable company is punishing its own viewers with this move and has denied that the rate-hike accusations leveled at them by the cable company.
While contractual disputes can be inconvenient, they are often necessary to ensure that a company is able to maintain the best interest of itself and its customers. Any company facing such a dispute may want consider retaining the services of a law firm with experience in handling contractual issues.
Source: New York Daily News, “Time Warner Cable yanks CBS off the air amid nasty contract dispute” Don Kaplan, August 2, 2013