from Summit Notebook:
Like the ‘net? Pay your cable bill, says Time Warner’s Britt
If you want the Internet to keep doing what it does, keep paying your cable bill, and don't get carried away with the idea of free (free! free!) content.
The next big free idea (sort of) is "TV Everywhere", the cable industry's attempt to make cable programming available over the Web -- for no extra charge -- to paying subscribers. It's an important initiative for the industry, since Pay-TV companies are concerned that the recession-resistant subscription revenue of cable television could be undermined if cable shows became widely available over the Web.
We asked Glenn Britt, chief executive of Time Warner Cable, what he thinks about the plan, and while he didn't detail when it will hit the ground, he reminded us that its success is critical. Why? The guys and gals that run the delivery system must be compensated. Think what happens if people (like so many college students I know -- and several journalists) start to depend on "free".
Free doesn't work in the long run. It works great for consumers, but if you took it to the extreme, and all of the networks put all of their content on websites for free, pretty soon consumers will figure out (they) don't need to buy subscription video services. Because my business has real cost to it, and we and the phone and wireless companies, we underpin this delivery, for this to happen we have to get paid.
We're like the seamly (sic) underside no one wants to talk about. We have trucks and blue collar people and wires, etc. If we didn't get paid, the whole Internet would fall apart. Somehow we are going to get paid. And if the networks don't get paid, new content wont be created.
If we all give our stuff away for free, we're not going to have a business anymore.
End
Time Warner Cable ready to fight high program costs
Time Warner Cable, the normally placid No.2 U.S. cable operator, is getting ready for a fight with its programming partners at the cable networks and broadcasters over rising affiliate fees. In truth, TWC has always been ready for a fight with the programmers. This time, it wants to make the first move and get its 14 million subscribers behind it.
The New York cable operator is launching an ad campaign “on behalf of its customers” to target what it sees as unfair price demands by programmers. It argues that these price demands, which usually come around this time of year at the end of programming contracts, can sometimes be as much as 300 percent increases. TWC says programmers make the demands “secure in the knowledge that video distributors are the ones who have to pass those costs along to customers and take the blame.”
So what’s Time Warner Cable going to do about it? They’re going to launch a website — yes, a website with the catchy URL: www.rolloverorgettough.com. News Corp, Sinclair Broadcasting and cable networks must be quaking in their collective fee-hiking boots.
(For the uninitiated: One way for companies to make money from their shows is to charge cable operators for the privilege of distributing them. Programmers like to raise those fees every so often. When cable operators resist, shows you like have a way of being held for ransom and sometimes disappearing for a while.)
Time Warner Cable’s website will allow customers to give their feedback and will be supported by ads in newspapers, TV and the Web.
“We want them to know why we fight so hard on these issues – if we Roll Over, they pay the price. If we Get Tough, they may lose their favorite shows until we reach a reasonable agreement.” said TWC CEO Glenn Britt in the press release.
It’s not the first time Time Warner Cable has tried to be principled about not overpaying for content. You might remember the great “Why is SpongeBob crying?” campaign of Dec 2008 when Viacom and TWC fell out over rising carriage fees.
I’m disturbed by this campaign. I’m a consumer and frankly Time Warner is the premium cable operator in my area. I pay almost 50% more for their service. They need to roll over and provide the channel lineup they commit too, or simply reduce the channels they offer and make their price competitive. Lets face it. Whatever results are garnered from this study could easily be overinflated. This is nothing more than a sob-story play by them and the customer’s concerns left on their “survey” site will likely be screened and only those aligned with their corporate strategy will be passed along to the broadcasters. Time Warner comes across as a sissy crybaby on a playground during recess in this campaign instead of acting like a national corporation. The Fortune 500 company I work for (Finance industry) would never advertise in such a shady and biased way. Shame on Time Warner. Sell commercials during these slots to make up your losses instead of pandering to customers for unjust sympathy.
