Time Warner Cable, like others in the pay-TV industry, has been essentially paying off content partners to prevent web-based streaming, Bloomberg reports. Incentives to lock-out content providers from streaming their properties online include monetary bonuses and threats to drop programming. Deals brokered between TWC and its partners are largely private, but some of their details were leaked to Bloomberg by anonymous inside sources.
"Exclusivities and windows are extremely common in the entertainment industry," said NY-based TWC spokeswoman Maureen Huff in response to Bloomberg's report. "It’s absurd to suggest that, in today’s highly competitive video marketplace, obtaining some level of exclusivity is anticompetitive."
Admittedly, deals peppered with stipulations of exclusivity aren't exactly a new thing. With more than 300 deals under its belt though, TWC makes no bones about its feelings toward would-be online disruptors.
Huff added, "In fact, the amount and scope of exclusivity and windowing in Time Warner Cable’s arrangements with programmers pales by comparison to that found between other players in the entertainment ecosystem."
In a nutshell: we do it, but others do it more.
Other companies, like Charter and AT&T, are also guilty of similar practices. AT&T is purportedly paying less to content providers who simultaneously provide online streaming while Charter claims to use such incentives and penalties to protect its cable-based "ecosystem".
If you're thinking deals like these are to blame for the poor state of TV streaming though, AllThingsD reports that may not necessarily be the case. Citing TWC as an example, its executive sources claim the company doesn't have those types of arrangements with the biggest players in the industry, names which include the likes of Viacom, Discovery and NBC. Hugely successful media companies have tons of bargaining power and often aren't so short-sighted to lock themselves into a no-streaming deal.
Rather, TV streaming outfits like Apple TV, Google TV and possibly even Intel have difficulty striking bargains because purchasing content to stream online is identical to the process used by cable companies: they must spend large sums of money on inflexible channel bundles -- a practice which the industry uses to subsidize its least popular properties with its most desirable ones. Even worse, since tech companies generally don't have much clout with big media, they often times wind up paying more than companies like Comcast and TWC for the same content.