The contract covers 33,000 poster sites in 275 stations and 88,000 panels in trains and was expected to run until 2015, but a major dispute has emerged over the costs of running the advertising network throughout the London Underground.

CBS claim they have found it extremely difficult to monetise the contract under the terms agreed when it won the pitch back in 2006 and have given notice that they intend to terminate the contract on March 31 next year, just less than four months before the start of the 2012 Olympics, unless terms are renegotiated.

A valuable source of marketing for London 2012 could be result as a result of the dispute. 

The advertising firm is currently suing London Underground for tens of millions of pounds' worth of damages as they claim that their work to install the digital screens on escalators and projectors on station platforms was delayed due to TfL's own construction schemes getting in the way causing their costs to overrun dramatically.

"For several years CBS Outdoor has sought to engage London Underground in fruitful, bona fide discussions to address the extraordinary costs and delays attributable to them," said Richard Sauer, executive vice-president and general counsel for CBS.

"CBS Outdoor is seeking a fair and equitable resolution of this matter."

The dispute is a far cry from 2006 when CBS won the pitch to handle the contract in one of the largest advertising deals in the world but the advertising firm say they have been seeking to reclaim costs since 2007 and has now been forced to turn to the courts to seek to terminate the contract and receive an unspecified amount of compensation for damages.

There is a six-month notice period for CBS to terminate the contract, which means that the outdoor company would have to officially cancel its agreement in October.

However, TfL have refuted claims that CBS has the right to terminate the contract with London Underground suggesting that it is unlikely that their digital screens would go dark during the 2012 Olympics.

"We do not accept that CBS is entitled to issue a termination notice and will be making it clear to CBS that it must honour its obligations under the contract," said strategy director at TfL Richard Parry.

"London Underground will vigorously defend CBS's claims and will seek to recover any losses as a result of CBS's action.

"CBS's claims that they want to terminate their contract due to delays to the London Underground upgrade programme are entirely spurious.

"Transport for London is engaged in discussions with CBS regarding the terms of the London Underground advertising concession."

London Underground claims it owns the infrastructure - about 70 per cent of the planned estate - that CBS has already installed.

This means it could put the advertising contract out to tender if CBS does pull out, but CBS say that London Underground is required to buy the infrastructure from it for an agreed price when the contract ends.

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