Time Warner Cable to offer no-frills package that could please subscribers and annoy programmers
Time Warner Cable is unveiling a new package that may be a hit with subscribers, but will likely anger a lot of cable networks that will be left out in the cold.
The new package, called "TV Essentials," will carry about 50 channels and be tested in New York City and parts of Ohio. Time Warner Cable said the package is valued at $49.99 per month, but will be discounted by $10 in New York and $20 in Ohio for the first year. The channels it will carry include feeds from broadcast networks ABC, CBS, Fox, NBC and PBS. Time Warner Cable also said it would carry 12 of the top 20 Nielsen-rated cable networks.
Time Warner Cable said it would have "representative channels from each major genre: news/information, sports, kids, music, lifestyle, shopping and general entertainment."
Among the channels that made the cut are TBS, FX, Cartoon Network, AMC, CNN and ESPN News. The channels not being offered include ESPN, TNT, Comedy Central, Fox News and MSNBC. ESPN and TNT are two of the more expensive channels on the market. ESPN runs about $4.00, per-subscriber, per-month and TNT costs roughly $1.00. Interestingly, CNBC, the highest rated business news channel is being passed over for rival Bloomberg, which has a much smaller audience, but is also cheaper.
"This video-only package isn't for everyone, but we hope that some of the most hard-hit by current economic conditions find it to be a helpful option," said Time Warner Cable Chief Executive Glenn Britt in a statement. A Time Warner cable spokeswoman said the company has the contractual right to create such a tier to offer subscribers.
An ESPN spokesman said, "cable operators rate ESPN number-one in value year after year in independent research and ESPN is coming off its most watched fiscal year in our history." An ESPN executive said the network did not think the new package would have a significant effect on the company's bottom line.
Previous efforts by cable operators to offer packages of fewer channels have usually met with great resistance from programmers. Several years ago, cable operators tried to launch a family-friendly package, and many networks who were left off grumbled loudly about being excluded. The package was not a huge seller for distributors.
Consumers who want to save money, but like pay channels HBO and Showtime will be able to buy those along with the TV Essentials package. But there will be no discounts. Also, subscribers to the package cannot get DVRs as part of their service.
The inclusion of local TV stations in a package being labeled as "TV Essentials" will no doubt be seen as further proof by the broadcast TV industry that its programming has value and that distributors should be willing to pony up cash to carry it. There have been several contentious fights between broadcasters and cable operators over distribution fees for their stations.
-- Joe Flint
For the record: This post was updated at 5:23 p.m. and 5:57 p.m. to include new information about the Time Warner Cable package including the number of channels being offered and a response from ESPN.