Like a good exorcist, the Federal Communications Commission looks set to drive back the merger sent from hell. In an interview with The Wall Street Journal, Republican FCC commissioner Ajit Pai says that the FCC is very unlikely to sign off on any proposed merger between Comcast and Time Warner Cable because the Obama administration has shown itself much less likely to approve major telecom mergers — such as the blocked AT&T-T-Mobile merger — than a Republican administration might be. A merger between Time Warner Cable and Comcast, which are the two largest cable providers in the United States, would further consolidate an industry that is already uncompetitive in many major markets. In addition to Comcast, smaller cable provider Charter has also been rumored to be interested in buying up Time Warner Cable.
It looks like the cord-cutting phenomenon is finally getting big cable companies’ attention. Variety reports that Time Warner Cable “is now marketing a low-cost bundle that includes a limited bunch of TV channels and HBO” that is “aimed at ‘cord nevers’ and others who aren’t interested in paying for a typical lineup of cable channels.” The new package, dubbed “Starter TV with HBO,” will be priced at $29.99 per month for the first year and “does not include a set-top box fees or other charges.” More →
Longtime readers know that I’ve been very critical of both Comcast and Time Warner Cable over their pricing policies, their service quality and their overall business practices. This is why I gasped in horror when I learned Friday morning that Comcast is talking with the Federal Communications Commission about what regulatory hurdles it needs to cross to merge with Time Warner Cable. More →
If there’s one thing that Americans have been clamoring for, it’s fewer choices when it comes to cable providers. CNBC reports that Comcast has been asking the Federal Communications Commission about the regulatory hurdles it might face if it tries to buy Time Warner Cable in a massive merger that would turn America’s two largest cable companies into an even bigger behemoth. While Time Warner Cable is apparently listening to several suitors’ offers, CNBC’s sources say that the company would prefer to be bought out by Comcast over any other competitor. More →
Cord cutting is accelerating at Time Warner Cable. Per The New York Times, Time Warner Cable reported that it lost 306,000 pay television subscribers last quarter, a record number that the company blames in part on its feud with CBS. Although both Time Warner Cable and Comcast have both been steadily losing pay TV subscribers, last quarter’s drop of over 300,000 is far and away the largest quarterly loss of any major American cable company we’ve seen this year. Cable companies have been struggling to hold onto pay TV customers who are now more likely to rely on their broadband connections to watch TV by streaming through Netflix and Hulu.
If you can’t beat ‘em, join ‘em… and if your cohorts can’t crush ‘em in court, crush ‘em in the market. Aereo is a streaming television service that has made a lot of waves recently. The pay service allows subscribers in certain regions to stream a handful of channels to PCs, smartphones and tablets for $8 per month. And according to broadcasters, Aereo is stealing their content. Aereo is being sued by several broadcasters including CBS, which alleges that the company is stealing its content and transmitting it over the Internet to subscribers. Aereo has not yet been shut down by these suits, however, and now major service providers including DirecTV and Time Warner Cable are planning to launch similar services of their own in the event Aereo prevails in court, Bloomberg reports. More →
As the producer of the world’s most pirated television show, you might think that HBO would be very eager to crack down on illegal streaming of Game of Thrones. However, the company has been surprisingly sanguine about all the BitTorrent users around the world who illegally watch its hit show every week. Now Business Insider reports that Time Warner, Inc. CEO Jeff Bewkes said recently that Game of Thrones piracy is a net positive for HBO because it creates more word-of-mouth excitement and it gives HBO more new subscribers than it takes away. More →
Modem fees are one of the cable industry’s less popular financial innovations but there’s a good reason that cable companies use them: They rake in a lot of money. Reuters reports that Time Warner Cable is jacking up its monthly modem fees from $3.95 to $5.99, which ISI analyst Vijay Jayant tells the publication that could help the company add an additional $150 million per year in revenue. Time Warner Cable is justifying the huge fee increase, which comes less than a year after the company first started charging fees for modems, by saying that the “cost associated with providing the modem” is higher than the company had originally anticipated. All the same, Time Warner Cable’s modem fees are actually a “bargain” compared with rival Comcast, which charges subscribers $7 a month to lease modems.
No one is really happy with cable bundles these days and now some cable customers are filing a class action lawsuit aimed at breaking them up. Consumerist reports that Time Warner Cable customers in California are suing the company because they don’t want to subsidize its exclusive sports broadcasting deals with rising monthly cable prices. The customers say that because they don’t watch any sports they shouldn’t have to pay higher prices just so Time Warner Cable can make up the $11 billion or so that it’s paid for the exclusive rights to broadcast Dodgers and Lakers games for the next two decades. In particular the plaintiffs claim that a ”very large segment of the consuming public is not sufficiently interested to pay $50-60 per year, but have no way of unsubscribing from either the Dodgers or Lakers telecast, which together add (or will if unrestrained) about $100 per year to the subscriber’s TWC bill.”
If you’re frustrated that HBO doesn’t make Game of Thrones and other hit shows available to watch on the web shortly after they air, then you might have Time Warner Cable to thank. Unnamed sources tell Bloomberg that Time Warner Cable “and other pay-TV operators are offering incentives to media companies that agree to withhold content from Web-based entertainment services” that “can take the form of higher payments or… threats to drop programming.” Bloomberg says that such incentives are part of Time Warner Cable’s efforts “to keep customers by ensuring access to exclusive content while fending off competition from upstart Web providers.”
Major Internet service providers in the United States have long taken a beating in customer satisfaction surveys, but the latest survey from the American Customer Satisfaction Index has the grimmest news yet for American ISPs: They now have the lowest customer satisfaction ranking of any industry in America, worse than even airlines, health insurance companies and gas stations. The survey shows that American consumers are particularly unhappy with ISPs’ call center service, with the variety of Internet plans they offer and with their quality of online video streaming. More →
We may now have a clue about how Time Warner Cable plans to implement its own Aereo-like service. Unnamed sources have told Bloomberg that Time Warner Cable is considering buying an equity stake in Hulu and “could offer Hulu to its customers as a bundled service inside and outside of the home with its current products,” meaning customers could access their favorite shows on Hulu without paying a monthly subscription fee for Hulu Plus. Under the plan being discussed, Time Warner Cable would take a 33% stake in Hulu with the rest held by co-owners Disney, Comcast and News Corp. Time Warner Cable CEO Glenn Britt recently said that the cable industry’s “structure needs more flexibility” and that he wants to offer customers “smaller, more affordable packages” that don’t cost them upward of $100 a month.
As amazing as it sounds, it seems that Time Warner Cable CEO Glenn Britt really does understand that customers are sick and tired of forking over large amounts of cash every month for cable television and Internet bundles. In an interview with The Washington Post, Britt said that the cable industry’s “structure needs more flexibility” and that he wants to offer customers “smaller, more affordable packages” that don’t cost them upward of $100 a month. To accomplish this, Britt says he’s considering following in the footsteps of controversial website Aereo, which streams over-the-air television over the Internet and lets users record their favorite shows for $10 a month. More →