UBS Media Conference: TWC’s Britt Says Carriage Battles Bad for Consumers

Time Warner Cable chief Glenn Britt envisions future where cable subscription gets you “the four ‘anys,’” says broadband becoming “most important thing we sell to people”

By Joel Topcik -- Broadcasting & Cable, 12/8/2009 1:25:50 PM

UBS Media Conference: Complete Coverage
Time Warner Cable CEO Glenn Britt waded into the perennial skirmishes between cable operators and programmers over carriage negotiations, saying that both parties need to be more mindful of consumers when wrestling over the rising cost of content.

Speaking Dec. 8 at the UBS Global Media and Communications Conference, Britt noted that programmers and carriers have a "symbiotic relationship" and lamented that "people in symbiotic relationships don't get along very well.

He said Time Warner Cable's "Get Tough or Rollover" campaign, in which the company invited consumers to weigh in online on how it should deal with programmers' cost increases, had received some 380,000 visits as of the previous evening and that 95% came down on the "get tough" side.

Britt said that the campaign was meant to educate consumers about where the cost increases were coming from. "The one good part of the content business has been the cable networks," thanks to the subscription-advertising dual-revenue model, he said, adding that "other sectors are trying to compensate by raising the price of content."

He said the company has "heard from some of the content companies" regarding the campaign. "They're wondering what exactly that's all about," he said. "Let's leave it at that."

Britt noted that the response, particularly in comments that showed consumers want to buy smaller packages of cable programming, demonstrated the soundness of cable's subscription model and its packaging of networks-factors that he believes underscore the demand for a TV Everywhere authentication play.

"Consumers like to buy these products in subscription form and they do like to buy packages," said Britt, adding that he envisioned a world in which a subscription would offer consumers what he called "the four ‘anys'": access to any content on any device, anytime and anyplace.

In that world, he said, "our role is kind of the plumbers...to do the plumbing and make it really easy for you as a consumer."

Speaking a day after Time Warner Cable reached an extension of its retransmission consent agreement with Sinclair Broadcast Group, Britt touched on the issue of retrans negotiations in general comments about the struggling broadcast model. Referring to NBC Universal chief Jeff Zucker's remarks at the confab the previous day, he said the relative strength of the cable model left broadcast networks stuck in a business plagued by "all sorts of anachronisms," including the exclusivity of network-affiliate relationships.

"I don't know where the broadcast networks are going to go," Britt said, noting that some 90% of viewers receive TV through a pay service. "There's still some sense that there's something called ‘free TV' out there; well, it's not free for the majority."

Addressing the fourth-quarter outlook for Time Warner Cable amid the protracted recession, Britt said there were "glimmers of light" in ad revenue and broadband sales, "but we're not out of the woods yet."

Responding to the growing clamor for interactive advertising, he assured the audience the company was working on it with the Canoe Ventures consortium. "For people who want instant gratification, I know it seems like it's taking a long time," he said. "But over the next year or so, you're going to see some things happening in that space."

On the subject of broadband, Britt said, "if it's not already, it's on its way to become the most important thing we sell to people-increasingly more than television." That demand promised opportunity for growth and "the ability to charge more over time." But it also promised increasing traffic congestion and the need to confront it as an industry.

"Either we're going to put up with the congestion as a society or we're going to allow some form of network management, which the FCC is starting to tackle, or we're going to charge more for using more," said Britt, adding that he favored some form of the latter.

He touched on the current debate over spectrum allocation and praised the FCC for its focus on "getting all the facts and approaching this in a thoughtful and balanced way."

Asked his thoughts on what the Comcast-NBC Universal deal says about the value of content-distribution synergies, Britt said that such synergies never delivered much value for Time Warner before it spun off its cable division.

"Brian Roberts doesn't seem to be talking about synergies, just that it a good investment," he said. "Time will tell....but it's not being done for all sorts of wonderful synergies."