Time Warner Cable losing basic, premium subscribers
July 29th, 2009, 9:04 am · 22 Comments · posted by Tamara Chuang, a.k.a. The Gadgetress
Our favorite cable TV company released its second-quarter earnings report this morning and its CEO is pleased.
Time Warner Cable continued to make more money, netting income of $316 million in the three months, ending June 30. In the same time last year, it made $277 million. Sales also grew 4 percent, or $176 billion, to $4.5 billion in the three months.
Nearly every segment of Time Warner grew — subscriptions were up 6 percent to $4.3 billion, video revenues grew 3 percent to $2.7 billion, Internet revenues were up 9 percent to $1.1 billion, and digital phone revenues were up 19 percent to $471 million.
The only areas that declined were basic and premium video subscribers and advertising, which was down a hefty 25 percent to $174 million. (And no wonder! One premium channel is $15 a month. And if you order all five premiums, that adds $53 to your monthly bill.)
If you’re scowling at this report because your cable bill went up this year, Time Warner said that its costs have risen, too. Video programming expenses, which include the per-subscriber fees paid to TV networks for the right to broadcast their channels, jumped 7 percent to $1 billion.
That brings us to the number of subscribers: It had 14,652,000 million, as of June 30, 2009. That’s down 11,000 from March’s 14,663,000 subscribers.
Those who remain with the company continue to switch services around — perhaps tempted by a offer to bundle? Many are jumping to Time Warner’s triple-play bundles, which is going for $99 a month right now. That includes TV, Internet and phone service. Triple-play customers numbered 3.3 million, up 90,000 new customers during the quarter. The number of customers who order just one or just two cable services declined.
Phone subscribers were also up to 4 million, Internet subscribers were up to 8.8 million. But overall video customers were down to 13 million. Click chart on right to enlarge details.
Based on its penetration rates, Time Warner is losing its hold on customers. The penetration rate — or the number of households who order service in communities where it’s available – is shrinking. Its video penetration rate dropped to 48.4 percent by June, down slightly from the 48.7 percent in March. Two years ago, that number was above 50 percent.
This compares to the inroads TV service rivals like Verizon FiOS and AT&T U-verse have made into Time Warner territory. While much smaller, FiOS and U-verse penetration rates continue to increase. FiOS TV, for example, was up to 24.6 percent penetration in its communities in June, compared to 19.7 percent a year earlier (see “Average Verizon FiOS bill is $135; TV service still growing“).
With competition heating up, Time Warner is looking into other areas to grow, such as wireless phones and web TV content. Reuters reminds us that the company joined Comcast Corp. and Clearwire Corp. last year in a 4G wireless partnership. Also, the company previously said it would be testing a “TV Everywhere,” allowing customers to watch cable TV shows on the Web.
Around the web:
- Time Warner Cable profit beats, warns of slowdown (Reuters)
- Time Warner Cable 2nd-quarter profit rises (AP)
- Time Warner Cable earnings report
Recent Time Warner Cable news on Gadgetress:
Check out the Gadgetress Guide to local TV services.
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Here's a list of TV/mobile companies helping consumers one tweet at a time. 
Add me to the list of who dropped TW in the 3rd quarter!
Their service is horrible. Not only do they keep sending us the bill in SPANISH, but refuse to send one in english!!! BYE BYE Time Warner!!! or should I say……Hasta LaVista ? @@
Time Warner sells/gives/trades your home address and UNlisted phone # to Whitepages,com
When I called to talk to someone about this invasion of privacy, I only got to email someone in India, never could get a phone #, name of a supervisor or anyone that I could talk to. period. If you call the local office they refer you to a website, hence the emails to India. There was a good reason for me to have an unlisted phone #, now that person whom I didn’t want to have it, not only has my phone # but my address also. I only had a phone with them (their package deal) for a month before they gave my #. to the white pages. In one of the emails I was told “I don’t know how your information got from here to there” !
DON’T USE TIME WARNER PHONE PLAN IF YOU WANT AN UNLISTED PHONE # TO STAY PRIVATE.
That reminds me of a recent LA Times column on unlisted numbers. Time Warner, like many other telephone companies, charges a recurring fee to keep the info unlisted. If you’ve been paying that fee and your information is still public, let me know and I’ll try to look into it.
Why can’t I turn to my boss and say “my costs have gone up, I’m passing them on to you”? Because there’s competition in the labor market, but not in the “de-regulated’ cable market. Interesting.
I can believe it!
$65 for crap basic cable!
I wish my landlady would let me put up my dish!
Hey OC Tax payer (hey, that’s me too!) — I’ve mentioned this before and it may help you: Apartment owners are required by law to allow outside antennas to improve TV reception but only if it’s on a renter’s private balcony or patio area. Here’s the FCC’s recap page: FCC’s Over-the-Air Reception Devices Rule, see 47 C.F.R. Section 1.4000, which “prohibits restrictions that impair a person’s ability to install, maintain, or use an antenna …” There are exceptions, of course. But if you have questions or need more info, call the FCC: 888-CALLFCC (toll free) or (202) 418-7096.
Tamara Chuang, a.k.a. The Gadgetress
Thanks again for the info however my apartment has no balconey or patio or anything I can put a dish on without attaching it to the building and my windows are facing east (so I cant have the dish inside)
So I am stuck
Its even worse for the disabled and low income seniors who only have rabbit ears on analog TV
Now with Digital they get one or two channels if they are lucky
i was on hold for over an hr.
my bill went from 51.46 to 80.22.
you SERIOUS????!!! im sure they’re not getting charged that much more.
i hate TIME WARNER CABLE!!!!!!
STUPID THIEVES. YOUR SERVICE SUCKS ANYWAYS!!!! AND YOUR CUSTOMER SERVICE
I HATE TIME WARNER CABLE!!!!
YOUR SERVICE IS SUPER CRAPPYYYYYYYYYYY!!!!!!!!!!!!!!
Screw a bunch of TW. So their cost went up… did they even try to negotiate with the networks. Of course not because they are in collusion with the networks to rip us all off so they can post a profit and the CEO can be pleased. The CEO obviously has not listened to the complaints from his subscribers about poor customer service and high pricing. Is he pleased with that also??
Suckers!!!!!
My beef with TW is that they don’t understand “TV Guide OnScreen”, also known as “Guide Plus+”.
My DVR became almost useless last year when TW quit passing through the analog TVGOS signal. This was somewhat to be expected with the “digital switchover”, but many cable systems are converting digital TVGOS to analog TVGOS for their customers. Not TW.
In January we bought a Sony HDTV with digital TVGOS and that worked for a while, but toward the end of May the digital TVGOS went away, too.
Contacting TW about this is hopeless. They have no clue what TVGOS is, and don’t understand why anyone would care since they have their own TV listings service. Not that it’s usable by my TV or DVR.
Macrovision (now Rovi) used to provide a page for users to complain about cable systems that weren’t carrying TVGOS, but they don’t even bother any more. They just say “We have confirmed with your cable provider that you should receive TV Guide/Guide Plus+ listings after the digital transition. If you are not receiving listings or if your listings discontinue, please contact your cable provider for more information.”
Doug — I don’t know much about TV Guide’s feature either. BUT this may help. Another reader had what I think is the same issue and somehow he resolved it. He, too, has a Sony and Time Warner Cable. Anyway, he said he redetected the stations using an antenna instead of his Time Warner basic cable feed (w/out any cable box). He told me: “The next day the TV went through a software update (detected somehow through the RF antenna). Then the TV rebooted/restarted, completed the software update. Then the TV guide function (embedded in the TV) was available and functioning. Neither Sony nor Time Warner could adequately explain why neither of these functions worked through Time Warner. The Sony Rep said the TV Guide function had been giving a lot of trouble and should be updated in about a month.” … Anyway, maybe that will help? Good luck.
I’m sorry the OC does not have Verizon or Charter. When I lived back east I had Time Warner and I loathed their service. Not looking forward to doing business with AT&T either.
Verizon, AT&T, Cox Cable, DirecTV and Dish Network offer TV service in O.C., though the first two have limited offerings. I try to keep reader TV options up to date at my “Guide to TV services,” found HERE.
I came home one day to see my TW cable and internet had been shut off. I called them up to find out what the problem was and they said I owed them almost $400. They said that charge went back two years, but they couldn’t tell me what the charge was for because those invoices had been archived. My bill was always current and I never missed a payment .
How can they expect me to pay for something that is two years old, yet can’t produce a record of the charges? Especially for something I didn’t owe them!
They wouldn’t turn my cable back on and couldn’t tell me what the charges were for. I signed up with DirecTV the next day and have been happy ever since. TW Cable will never get another dime from me.
Oh doh! I really don’t understand why companies aren’t putting excessive amounts of money into customer service.
All the plans are good. Your going to get Spanish no matter what service you pay for.
I would drop TimeWarner but Virizon is in India I hate contracts. So who???
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I just don’t understand the State and City taxes being more then the service bill.
TV sucks! Nothing more than a marketing tool used to enslave the masses-and the masses pay for it.
TW and all other overpriced cable companies and newspapers. The end is near. People are canceling their subscriptions because the Internet provides so much more. You’re license to print money is expiring! Goodbye.
TW has a very confusing advance billing. At the time, I subscribe to TW, they have a three-month free premium channel offer and that there will be no charges for the premium channels if I cancel the premium channels after the third month. The problem is TW billed me for the premium channels on the second month. I called and they said that if I cancel the premium service, my payment will be reimbursed or credited back. I dare not risk anymore future mis-billings and mis-charges. I returned my box and canceled TW immediately.
Never subscribe back. The HD converter works just fine.