Maybe TW cable will start to figure us out

[fblack_111]

Interesting story in today's WSJ. The main story is about possible cable mergers. But some info in the story is insightful. IE: If the trend continues, TW is on pace to lose nearly 500,000 cable TV subscribers a year.

"...Time Warner Cable's performance has lagged behind that of its peers. In the first quarter, the company lost 119,000 video subscribers, a deeper loss from the year-earlier quarter when it lost 94,000... Time Warner Cable's video-subscriber losses worsened or stayed flat, even as Comcast's improved....Time Warner Cable executives have acknowledged disappointment in their video numbers and have blamed weak results earlier this year on too-aggressive promotional offers that led to customer disconnections after the discount expired. The company has taken steps to improve its video performance, including changes to its pricing and technological updates.....Time Warner Cable, the fourth-biggest pay-television operator by subscribers, has about 12 million video subscribers,..."

http://online.wsj.com/article/SB10001424127887323734304578547661992416732.html

 

[Admin65]

TWC does have triple play promo's with $300 gift cards, so they must be looking for new customers.

 

[fblack_111]

And there are more merger talks too. Not sure if or how it would affect TW subscribers.

"... The rumblings reached a crescendo at the annual Cable Show earlier this month that the Liberty Media chairman (John Malone) will use the 27% stake of Charter Communications he purchased in March to acquire other U.S. cable operators — potentially even the second-biggest, Time Warner Cable. Reports have suggested Liberty has already engaged TW Cable in merger talks, but nothing is in the offing yet...."


http://variety.com/2013/biz/news/where-john-malone-may-move-next-1200502022/

 

[fblack_111]

Once again TW cannot figure out what we want and how to run a company. I will quote from today's WSJ story (you must be a subscriber to read it all on line) In addition to substantial subscriber defections, they actually state that they intended to stick price increases to existing users who will not defect rather than offer a product and pricing to retain and develop new customers. I swear if I could find a reliable, quality (not TIVO) private brand OTR DVR (that would stream shows to my TV's) I would dump the Cable portion of my bill and phone. Here's some quotes from the story.

8/1/2013 Time Warner Cable Earnings: Subscriber Numbers Weak
Quarterly Results Likely to Intensify Takeover Speculation

"Time Warner Cable Inc. reported weaker subscriber numbers in both its video and broadband businesses, a quarterly result likely to intensify takeover speculation surrounding the company....The New York-based company shed 191,000 video subscribers, compared with 169,000 a year earlier, while growth in high-speed data subscriptions decelerated to 8,000 from 59,000 a year ago. The company also lost 56,000 telephone subscribers in the latest period, while a year ago, it had added 45,000 subscribers....Higher cable rates, including an increased modem rental fee, helped the company report marginally higher revenue from its residential business... The company attributed the results to a new strategy focusing on customers who are likely to pay more for additional services and stick around, "even if that means fewer" additions, said Chief Operating Officer Rob Marcus...."We made a conscious choice between rate and volume" that resulted in the weakness in subscriber additions,...

"The results contrasted with those of Comcast Corp., the country's biggest cable operator,... Comcast reported a lower rate of video subscriber losses and what it said was its best broadband subscriber growth in several years. ..."Analysts said that Time Warner Cable's results show continuing operating weakness. .... but "now it is simply a takeover candidate, and its stock price hinges on that and almost nothing else. Today's results make a deal more likely."

http://online.wsj.com/article/SB10001424127887324136204578641513108375732.html?mod=ITP_marketplace_3&cb=logged0.08707480784505606

 

[kevinc]

I share your frustration. Cable TV and those who run it is increasingly looking like a 20th Century dinosaur product especially as Intel and possibly Apple ready Internet TV offerings. Although I assume the picture quality of those offering will be compromised like Netflix streaming relative to current cable TV, I am sure they will catch on if they offer better convenience and lower rates, just as streaming video has killed superior DVD/Bluray and before them poor quality mp3s killed CD/SACD. In the meantime I think further cable consolidation will only mean higher bills for consumers rather than the increased clout being used to negotiate more rational rates from the likes of ESPN but in the long run it's probably the only way the cable companies will survive other than as pure internet providers.

As for me, I've switched to cablecards and dumped Time Warner's ancient dvrs in favor of building my own htpc and extenders for a far more sophisticated whole house DVR than TWC currently provides, but "reliable" is not necessarily the first term I'd use for this approach!

 

[Admin65]

I share your frustration. Cable TV and those who run it is increasingly looking like a 20th Century dinosaur product especially as Intel and possibly Apple ready Internet TV offerings. Although I assume the picture quality of those offering will be compromised like Netflix streaming relative to current cable TV, I am sure they will catch on if they offer better convenience and lower rates, just as streaming video has killed superior DVD/Bluray and before them poor quality mp3s killed CD/SACD. In the meantime I think further cable consolidation will only mean higher bills for consumers rather than the increased clout being used to negotiate more rational rates from the likes of ESPN but in the long run it's probably the only way the cable companies will survive other than as pure internet providers.

As for me, I've switched to cablecards and dumped Time Warner's ancient dvrs in favor of building my own htpc and extenders for a far more sophisticated whole house DVR than TWC currently provides, but "reliable" is not necessarily the first term I'd use for this approach!

I would agree with you on the reliable term. My desktop has a Ceton tuner and it too has had it's fair share of problems.

 

[fblack_111]

So now TW is trying a new ploy against CBS. They are "suggesting" CBS go to a pay to view system wherein TW will pay CBS for each subscriber who signs up for CBS via TW. So if you want CBS via TW cable you pay TW a fee and they in turn send CBS their share. Actually I like it. I an tired of paying a huge TV bundle price to TW to get 200+ channels of which I only watch maybe 10. So I say let TW provide an a la carte pricing method. Pay then a base fee (say $10 to TW) then maybe $1.25 to $1.50 for each channel you really want. Maybe they charge $5 for ESPN. $2.00 for Fox News and CNN. Etc. Or if a customer wants it all, charge what they are charging now. To me, Choice and a la carte pricing is good. But TW will never go for it. What we need in San Diego is better competition. My neighborhood cannot get Uverse. And Dish or DirecTV have their own set of issues.

 

[kevinc]

So I say let TW provide an a la carte pricing method. Pay then a base fee (say $10 to TW) then maybe $1.25 to $1.50 for each channel you really want. Maybe they charge $5 for ESPN. $2.00 for Fox News and CNN. Etc.

While I'm all for that in principle the problem is that while TWC do pay ESPN of the order of $5 per head right now that is only because ESPN is bundled into so many homes: if TWC managed to agree with ESPN to unbundle it and go a la carte or push it in the sports pack then a large number of households would drop it and if ESPN Was to receive anything like the same revenue (which it needs to pay the ever more crazy price of Monday Night Football etc) then the price per ESPN subscriber would probably go nearer $20 (see how much people in the UK have to pay for Sky Sports which is the comp). If you are an ESPN viewer today you are being subsidized and would almost certainly eventually end up worse off under such an arrangement. Sometimes you have to be careful what you wish for. However, yes in principle I'm all for more transparent pricing and a la carte - it's the only fair way and maybe then the sports channels and sports owners would get more rational on their deals.

 

[fblack_111]

And again today the WSJ has an interesting story on cable TV's problems. They allude to cable TV companies falling into the same trap that crushed many newspapers. Drastically falling revenue and changing public tastes.

WSJ On-Line: CBS-Time Warner Cable Dispute Shows an Industry Unaware of Reality

"... The dispute is one that has become commonplace in pay TV, centering on how much more money Time Warner Cable should pay to carry CBS on its cable lineup. CBS says it wants to be "paid fairly" for its programming, while Time Warner Cable says it is trying to protect its customers. But at the core of it, the companies are squabbling over their share of pay-TV's spoils—money that, if the newspaper and music industries are any guide, could disappear much faster than anyone expects.... Newspaper print ads fell 55% between 2007 and 2012, according to the Newspaper Association of America....In television though, it isn't about the future. It's about protecting the past. The players are seeking to squeeze more money from the existing ecosystem—an ecosystem in which U.S. households pay an average of $84 a month, according to SNL Kagan, for hundreds of channels they don't watch....

"...these arrangements aren't sustainable. Younger people watch what they want online, making the idea of cable TV less appealing. The percentage of people age 13 to 33 subscribing to pay TV fell to 76% this June from 85% in June 2010,... . "Cord cutting used to be an urban myth. It isn't any more," said cable analyst Craig Moffett in a report Tuesday.... Yet the entertainment companies seem blissfully unaware."

http://online.wsj.com/article/SB10001424127887323420604578652271175622986.html?mod=ITP_marketplace_1

 

[fblack_111]

Another story about Time Warner again today. Basically, poor performance by Time Warner's cable business is driving up it's stock price a bit because investors think it will increase TW's chances of becoming a takeover target. Possibly by Charter Cable.


10/13/2013: Down Is Up for Time Warner Cable
Investors Might See Weak Results as Pushing Company Toward Deal

"...The company is still grappling with the aftereffects of aggressive promotions in 2012 and will likely be further hampered by an August blackout of CBS in some markets. UBS expects Time Warner Cable to lose a net 210,000 residential video subscribers in the third quarter, for which it reports results Oct. 31....In talking up a deal, Mr. Malone walks a fine line between recruiting Time Warner Cable shareholders to his cause and pushing up the price of his target....".

http://online.wsj.com/article/SB10001424052702304500404579129791936278318.html

 

[fblack_111]

Now there is again strong consideration to buy Time Warner. There have been numerous stories about it. Who knows if a Comcast will be better than Time Warner. Link below

11/22/2013: Time Warner stock pops on bidding war report

Shares of Time Warner Cable shot up nearly 10% Friday following reports that a bidding war for the second largest U.S. cable company may be brewing.

TWC has reached out to Comcast for a possible merger as the companies' key shareholders have pointed out their compatibility and the regulatory changes that could enable such a deal...Meanwhile, Charter Communications, is also close to finalizing a deal with banks to raise enough money to make a run at TWC...Comcast owns a little over 20% of the market. And a combined Comcast-TWC would account for 33% of the pay-TV subscribers in the U.S


http://www.usatoday.com/story/money/business/2013/11/22/time-warner-comcast-takeover-report/3674753/

 

[Admin65]

Charter wants twc, so they can use twc's knowledge and expertise to enhance their video product.

Sent from my Galaxy Nexus via Tapatalk 4

 

[humdinger70]

Maybe a new management company might figure a way to finally get Fox Sports San Diego on our system.

 

[Admin65]

http://online.wsj.com/news/articles/SB10001424052702304465604579222300576167872

Now Cox is looking to buy TWC or maybe bits and pieces of it. I could see Cox taking over TWC San Diego and North County!

 

[Admin65]

Also, Comcast is interested in buying twc, but they are not opposed to a split bid with charter where comcast and charter buy the pieces of twc that they want and not twc as a whole.

Sent from my Galaxy Nexus via Tapatalk 4

 

[Rick Shaw]

Also, Comcast is interested in buying twc, but they are not opposed to a split bid with charter where comcast and charter buy the pieces of twc that they want and not twc as a whole.

Sent from my Galaxy Nexus via Tapatalk 4

So, would YOU rather be acquired by Comcast or Charter?

[No, that's not a rhetorical question.]

 

[fblack_111]

While Cox may be interested in buying TW, I would have to believe they would have issues with the government. Yes San Diego still has Satellite TV and Uverse, but a combined Cox and TW would be close to a monopoly.

 

[Admin65]

Maybe Cox would only buy parts of TWC and not TWC as a whole. I am seeing a possibility of a TWC broken up ala Adelphia were companies like Charter, Cox, and Comcast would only buy the parts that they want.

 

[Admin65]

http://www.deadline.com/2013/12/charter-readies-38b-bear-hug-offer-for-time-warner-cable-report/
http://www.foxbusiness.com/industries/2013/12/13/report-charter-readying-offer-for-time-warner-cable/
http://www.usatoday.com/story/money/business/2013/12/13/charter-offer-time-warner-cable/4013157/

Rumor has it that Charter is preparing a $38 billion deal to buy out Time Warner at around $135 a share. Comcast is also looking into a merger, but an FCC commissioner said that deal would be DOA.

 

[Admin65]

http://www.reuters.com/article/2013/12/16/us-timewarnercable-comcast-idUSBRE9BF1CJ20131216

Basically, Comcast has 3 options that they are looking into, in regards to TWC.

1. Buy TWC as a whole and face regulatory scrutiny
2. Buy parts of TWC that work for Comcast
3. Team up with another cableco (e.g. Charter, Cox, etc) and buy the bits and pieces that work for both parties.