After months of banter about the promise of subscription video-on-demand, Time Warner Cable's Columbia, S.C., system will be the first to launch Home Box Office's SVOD service this summer, according to sources close to the situation.
The 130,000-subscriber system will be the first in the U.S. to offer commercial SVOD services from any premium programmer, according to sources. HBO, Showtime Networks Inc. and Starz Encore Group LLC all have discussed bowing an SVOD service sometime this year.
Representatives from HBO would only confirm that it is planning to launch SVOD sometime this year.
Time Warner Cable vice president of corporate communications Michael Luftman also would not confirm the South Carolina launch. He said a commercial SVOD deployment will take place "in the not-too distant future," before adding that "we will also expand into another system over the summer."
What's unclear is how much HBO will charge for SVOD, which allows subscribers to order such original fare as Sex and The City
and The Sopranos
— as well as hit movies within the premium window — on-demand with VCR functionality, including pause, fast-forward and rewind capabilities.
Pay TV executives have said that prices could range anywhere from $3 to $10 a month, in addition to traditional monthly premium rates.
AOL Time Warner Inc. chief executive Gerald Levin, speaking at the Deutsche Banc Alex Brown Media Conference in New York last week, said the company will test three different price levels to determine how much subscribers will pay for the service, although he would not provide specific details.
"Consumers will pay X dollars for that privilege, to get HBO subscription video on demand. If I'm right about that, that's a very significant thing," Levin said.
Adelphia Communications Corp. last month announced it would offer subscription video-on-demand services as part of its VOD services in Cleveland and Western Pennsylvania. But rather than charge a fee for the service, Adelphia executives said it would fold SVOD into existing premium packages as an added-value component intended to reduce churn.