Here We Go Again

TWC Vs. Mickey

Poor Time-Warner Cable. Mickey Mouse is trying to rip them off.

Time-Warner Cable customers are getting email and spots are running on the cable that Disney, owner and operator of ABC TV, ESPN, and Disney Channels, is threatening to pull programming from Time-Warner. It’s another one of those revenue things that seem to happen with TWC every six months or so.

Of course, if Disney plays hardball, “Baseball Tonight” and “Desperate Housewives” could disappear from the cable line-up. (It seems that channels are disappearing from the standard line up all of the time. More about that later.)

“To connect you with all the shows you love to watch, we must pay the companies that own the broadcast TV stations and cable networks. We fight to keep those fees as low as possible, because they directly impact the cable bill you have to pay each month,” says TWC on its web site RolloverorGet Tough.com. “When all is said and done, Time Warner Cable earned a profit for its shareholders of about $0.06 for every dollar that we brought in during 2009. (That’s slightly below the average of 7% for the past 10 years among US companies in the S&P 500, according to the Wall Street Journal.)”

Let’s not forget that TWC is the second-largest cable company in the nation. The figures above notwithstanding, they make lots of money.

August 5, 2010, TWC reported its second-quarter profit rose 8.2%, as demand increased for its broadband and phone services and capital expenditures decreased, according to MarketWatch.com. “It earned $342 million, or 95 cents a share, compared with a profit of $316 million, or 90 cents a share in the same quarter a year ago. Revenue rose 6% to $4.73 billion.”

They’re doing OK. Better than most of us. Viewers should keep these things in mind as they read their email and see the spots from TWC. Also keep in mind that ABC programming will be available off-the-air via your digital converter and antenna. Watching ESPN and other cable channels are more problematic. TWC makes a point of saying that it won’t do any good to switch since Disney already pulled its HD programming from Dish Satellite in June.

Meanwhile, a spat between the City of Austin and Time-Warner Cable is brewing. When Time-Warner wrote a new franchise contract, it included public access channels for the City of Austin, the Austin School District, Travis County, the state legislature and even ordinary citizens. As of October 1, 2010, those channels are slated to be boosted to the digital tier.

It will take a cable box to receive them. Those boxes cost $7 per month each. TWC says it will supply one box for varying periods of time to customers who have standard service. What about customers who have multiple televisions?

Stacy Schmidt, TWC spokesperson, says the cable company is moving the channels to increase services and speed. “It’s what customers are demanding”

To this writer and perhaps the City of Austin, the move of local access and government channels to the more expensive, digital tier violates the spirit of the original agreement that created them. The City of Austin is threatening to take TWC to court over the changes. Austin City Council and commission meetings are telecast on Channel 6.

© Jim McNabb, 2010