Bewkes: Retrans Is Good for Time Warner

Time Warner CEO touts health of subscription model and his company's prospects in the face of new technology at Credit Suisse conference

Time Warner CEO Jeff Bewkes outlined March 9 the reasons why he supports broadcast networks getting paid by distributors for their content and why he believes his company isn't under threat from new technologies.

"On balance, it's a good thing," Bewkes said Tuesday at the
annual Credit Suisse Global Media & Communications Convergence Conference
in Palm Beach, Fla. "The networks are going to try very hard to get some kind
of a material retransmission payment and they'll succeed to a certain extent."

He added: "We are a very interested party with strong
relationships selling series to broadcast networks.... We have a very big
business, we sell to all four networks, and their ability to continue that
profitable business is good for Warner Bros. and good on the Turner side since
a significant staple of those properties is the acquired series that we
produce. Having this ecosystem will help TNT and TBS."

Bewkes said that over the past six months there has been a
huge swing towards the subscription model that is the basis of Time Warner's
biggest business, whether through Turner Broadcasting or HBO.

"The fight to move subscription models online has gained
momentum in the last six months, whether at The
New York Times
with pay walls or the Wall
Street Journal
, or whether it is some of the broadcast networks seeking
retransmission fees. There is a movement towards a dual-revenue stream, with
premium advertising and subscription models going across all kinds of TV
networks and print products."

Bewkes also used the investor forum to clearly articulate
Time Warner's position when it comes to talk of technological forces sweeping
away old business models.  He told
investors that much of the fear surrounding old media was exaggerated by the
press and said it was highly unlikely big media companies would be forced into
the positions that music and newspapers have found themselves in because they
had the power to refuse to accept less advantageous business models.

"No one has the leverage to force the branded media
companies into a model that isn't attractive to them," Bewkes said. "What we
have not done is put content online for free.... We did not go into Hulu. We did
not put WBTV online for free or full versions of our magazines. We didn't think
this was the way to go."

Explaining away the threat of piracy, Bewkes added that
enhancing all the TV options helped form a loyal bond with the consumer, and
that the rights of intellectual property owners were also being recognized to a
greater extent by political and legal entities.

"Watching linear TV through multiplex and on-demand, or in
hi-def and 3D--we've got a fantastic blooming of innovation that makes the
alternative of forced loss of business through piracy unlikely."