Time Warner Cable: Business Impact of Internet Video Services ‘Not Measurable’
Glenn Britt, chief executive of Time Warner Cable, acknowledges that Netflix streaming and other over-the-top video services “may well be” impacting the market for the company’s premium channel subscription packages and paid video-on-demand programming.
“But nobody that I know,” Britt told analysts during a Thursday earnings call, “has been able to measure [the impact] yet.“
Time Warner Cable, the second largest cable company in the U.S., reported revenue declines on Thursday for both its premium channel subscription packages and video-on-demand services during the third quarter of 2011 (ended Sept. 30). Premium channel revenue at Time Warner Cable declined by $12 million during the quarter, from the same period in 2010. Transactional video-on-demand revenue, meanwhile, declined by $7 million year-over-year.
“I think the subscription premium services are clearly impacted by the economy as consumers try to cut back,” Britt maintained (transcript via Seeking Alpha). “We always think we could do a little better job of marketing, and we’re focused on that. So it’s not totally the economy, but I think that’s certainly an element.”
Within the company’s paid video-on-demand segment, Britt added, “the movie part is very dependent on how many titles are released and perhaps how they did in the box office….Some of the movies,” Britt said, “were weaker than they were a year ago.” Transactions for adult entertainment have been in decline for some time, Britt noted; transactions for pay-per-view events, meanwhile, was flat.
Although Time Warner Cable also reported a loss of 126,000 video subscribers during the third quarter, Britt noted that the subscriber losses were fewer than during the third quarter of 2010. “We actually gained video subscribers in September,” he said.