Time Warner Cable Says Customers Left Because Of Blackout; CBS Unaffected

In news that will hopefully sour cable companies’ view of blackouts as a viable negotiation tool, Time Warner Cable has admitted that its pointless, month-long standoff with CBS ended up costing it customers. Meanwhile, the network came out of the dust-up unscathed.

TWC didn’t just lose customers in the three cities most affected by the blackout: Los Angeles, New York City, and Dallas. The company’s Chief Operating Officer recently told investors that possible new customers were turned off from signing up with the company during the blackout, which took away CBS from around 3 million TWC customers and temporarily removed Showtime from all TWC subscribers nationwide.

And yet, the company is still insisting that it made the right move.

“While those are short-term hits that are not insignificant, we felt that it was justified based on the goal of achieving longer-term objectives,” said the COO Rob Marcus. “We ended up in a much better [place].”

This is like your friend who gets fired from his or her job and then tries to rationalize that it’s “all for the best” when it’s really just a sad turn of events. And given how consumers are fleeing traditional cable TV for Internet-only entertainment, this is like your friend getting fired from a job that is becoming irrelevant to the marketplace, but still insisting that it’s all good.

Time Warner Cable has maintained that it had to pick this fight with CBS — a fight in which it lost subscribers and still has to pay more for carrying a station that most of us can get for free over the air — in order to get the ball rolling on retransmission reform.

“The issues that were at stake in this negotiation had such significant implications and long-term implications that we felt like we were left with no choice,” said Marcus. Of course, he’s got to say nice things as he’ll soon be taking over the CEO gig from outgoing leader Glenn Britt.

Meanwhile, CBS Chief Executive Les Moonves claims that the blackout — which came during the dog days of summer, when many people are doing anything other than watching TV and those that are will watch hours of static — “didn’t hurt us one iota financially” and that ad revenue didn’t drop. Similarly, Moonves says that ratings rebounded once the blackout was lifted.

Neither company is talking about how much more CBS is charging TWC to carry the network, though customers will soon be able to guess when the cable company inevitably passes that buck on to their cable bills.

Time Warner Cable Says It Lost Customers in Blackout [WSJ.com]
CBS’ Moonves says company wasn’t hurt by Time Warner Cable blackout [L.A. Times]