Time Warner Cable's Glenn Britt Warns Distributor May Drop Expensive Networks

Time Warner Cable President, Chair & CEO Glenn Britt yesterday “warned entertainment companies that he plans to take a ‘hard look’ at programming contracts and may drop TV channels that ‘cost too much relative to the value of the service,’” according to Ramachandran & Stewart of the WALL STREET JOURNAL. TWC and several other pay-TV distributors have “recently complained vocally about the rising fees that entertainment companies, especially those with valuable sports programming, are charging to carry their channels.” Britt said that since ‘08 TWC’s programming costs “have gone up more than 30%, while the prices it charges video customers have only increased 15%.” Britt: "We've accumulated networks that hardly anybody watches.” Britt also “expressed frustration at programmers who think that full distribution across cable platforms is a ‘birthright’” (WALL STREET JOURNAL, 12/4).

POWER OF SPORTS: In L.A., Flint & James wrote under the header, “Rising Sports Programming Costs Could Have Consumers Crying Foul.” Cox Senior VP/Content Acquisition Bob Wilson “estimated that sports account for more than 50% of the bill for the provider's Southern California subscribers even though just 15% to 20% are regular watchers” (L.A. TIMES, 12/2).

COSTLY CHANNELS: The WALL STREET JOURNAL’s Tom Gara cites data from SNL Kagan showing estimated annual affiliate revenue for various cable channels in '11, comprised of the “total fees charged, divided by the number of houses who actually watch the channel.” There is a “disparity, even among the top 20: ESPN, the number one, earns more than five times as much per household as the Style Network at number 20.” SNL Kagan Senior Analyst Derek Blaine “thinks the channels that will face the toughest negotiations will be those attracting premium fees alongside relatively small audiences and no major media group backing them up.” Examples in the top 20 “include soccer station GolTV” (WSJ.com, 12/3).