Sony, Viacom Strike Streaming Pact

Mari Silbey
News Analysis
Mari Silbey, Senior Editor, Cable/Video

The Wall Street Journal reports that Sony Corp. has reached a "preliminary deal" with Viacom Inc. to distribute the programmer's channels as part of a new Internet-based television service.

While numerous other big-name companies -- including Intel Corp., Google, and Apple Inc. -- are hard at work prepping their own online offerings, the Viacom news is the first indication that major content owners are willing to participate in the over-the-top (OTT) pay-TV revolution. (See Google, Apple Pitch Pay-TV Services.)

Sony is reportedly holding discussions with other media companies as well, including Walt Disney Co., Time Warner Inc., and CBS Corp. The consumer electronics giant also has its own content assets to mine, thanks to the Sony Pictures Entertainment subsidiary. Sony studios produce popular TV shows like Breaking Bad and Justified, along with high-budget Hollywood movies.

The licensing agreement with Viacom, if it materializes, would be a landmark deal in the feverishly competitive pay-TV market. It could also set off a firestorm among cable, telecom, and satellite TV companies anxious to protect their television turf.

Time Warner Cable Inc.has already been cited for creating contractual clauses that bar programmers from licensing their content to new online service providers. The US Justice Department is examining the competitive impacts of such backroom negotiations. (See Cable Operators Show Them the Money.)

Sony hopes to launch its new streaming service early next year on the Sony PlayStation. The company would then extend the service to Sony smart TV sets and other Internet-connected devices.

— Mari Silbey, special to Light Reading Cable

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