Britt: Video Losses Unacceptable


Time Warner Cable chairman and CEO Glenn Britt said that cable operators should focus on winning back video subscribers at an industry conference Monday, but stopped short of saying when that reversal could happen.
Speaking at the Deutsche Bank Securities Media & Telecom conference in Palm Beach, Fla., Britt said the years of basic video subscriber losses are taking its toll.
While basic subscriber losses have been commonplace over the past few years - according to the NCTA, cable companies have lost a collective 4.8 million video customers from their peak in 2001 to 2009 - a handful of operators are showing some improvement. In the fourth quarter, Time Warner Cable and Comcast reported fewer than expected basic video losses, in part because of the strength of the bundle of video, voice and data,
"We need to really to focus on that with a renewed intensity," Britt said of video customer losses. "It is not acceptable to me to continue to slowly lose video customers every year. That has been going on for too long. We're going to put renewed energy against that both in the product space and in marketing, to see if we can slow that down."
Britt stopped short of saying when that reversal could happen, adding that there are a number of external factors to the industry's history of video customer losses.
"The growth of the category has been very much affected by what is going on in the housing market," Britt said, adding that home ownership is down about 350 basis points from before the recession and household vacancy rates are at a 30-to-40 year high. "Until the housing market settles down, we're not going to see robust category growth."
He wouldn't commit when asked if the renewed focus on video would restrict the MSO from annual price increases.
"We are approaching pricing very differently than the old model," Britt said. "We're offering a large set of different products, services and packages and offerings in different geographies. We're not treating people like one-size-fits-all."
Time Warner Cable, he said, has hired "pricing experts," that test elasticity and demand on different product offerings in different geographies.
"We target prices based on that information," Britt said.
On the broadband front, Britt said that usage-based pricing, long a controversial issue in the Internet community, could be inevitable.
"I think you will naturally see evolve a world where people who use very little broadband expect to pay less and people who use a whole lot, may complain, but in their hearts know they are going to pay more than somebody who reads email once a week," Brit said. "I think there will always be an unlimited tier, but I think you'll see the element of consumption introduced over time."