Time Warner Cable CEO Glenn “Two Ns, Two Ts” Britt has been an outspoken critic on broadcasters who package desirable, high-viewership channels with niche-market offerings and tell cable companies to pay for them all or get access to none, which results in the cable providers passing these bundles (and the price tag) on to customers, many of whom only watch a handful of the hundreds of available channels. It’s a model, says Britt, that could have dire consequences.
At this week’s Cable Show conference, Britt pulled out his crystal ball and saw dark things when he spoke to Wall Street analysts.
“People are starting to pay attention to the fact that the multichannel TV package, the big package which is in 90% of the homes, is starting to get too expensive for lower-income people,” warned the TWC CEO.
Britt also cautioned that there is a danger in scoffing at Sen. John McCain’s latest attempt to legislate a la carte pricing for cable.
Sure, I stand a better likelihood of starting at second base for the Phillies than this bill does of being passed, but Britt says this is “just the beginning… It would behoove the whole industry, including the content companies who are all crowing about their pricing power, to pay attention because it will come to some end that we may not like if we all keep behaving the way we are.”
Of course, the very people that Britt says should be concerned about the status quo are instead pointing to the status quo as evidence that all is right in Cable Land.
“Every once in a while there are publicized disputes” said Viacom CEO Philippe Dauman, who obviously has not watched any of the vitriolic ad campaigns — including entire cable channels and websites set up to advance cable and broadcasters’ viewpoints and smear the other companies. “But consumers are more and more satisfied with the product. … It’s remarkable how resilient the product has been because consumers are satisfied.”
Dauman’s comment also ignores surveys like the American Customer Satisfaction Index, which found that cable and Internet providers (the largest of which are also cable companies) represent two of the three lowest-scoring industries on the entire Index.
In other related TWC news: Bloomberg is citing people with insider knowledge who say Time Warner and other pay-TV companies are handing out incentives to media companies if they cross their hearts and swear to die that they won’t put content on the Web for streaming.
Those incentives might be money, in the former of higher payments, or the dangling carrot of a promise by TV operators not to drop programming.