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Hate paying more for cable TV? Time Warner is taking a vote
November 27th, 2009, 12:22 pm · 38 Comments · posted by Tamara Chuang, a.k.a. The Gadgetress
UPDATE, 12/7: Early results are in. See “400,000 consumers tell Time Warner to stop price hikes.”
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Interesting new marketing campaign Time Warner Cable just launched: Roll over or Get Tough.
Every year, it seems, the cable provider (and to be fair, every other paid-TV service too) hikes up TV rates. This time, Time Warner is putting customers on alert saying that it’s the TV networks gouging customers. Popular channels demand higher fees with some asking for “up to 300 percent,” according to the new campaign.
So consumers, should Time Warner say “No way!” and risk losing those channels? Or should the cable provider cave to demands?
It’s not an entirely silly campaign. TV providers have to renegotiate contracts with TV channels and those channels try to ask for a little more money, also called carriage fees. Ultimately, subscribers pay the extra fees, usually announced as rate hikes right around the end of the year.
Sometimes, the negotiations go sour and TV channels take it public. Remember last year’s showdown between Time Warner and Viacom, which owns MTV, Comedy Central and Nickelodeon? The two fought till the very last minute, with Viacom threatening to pull its channels from Time Warner if they didn’t pay 23 cents per month more per subscriber.
This particular campaign is timed just as Time Warner is facing expiring contracts with News Corp. (Fox, FX), Scripps Networks Interactive (Food Network, HGTV), the Weather Channel and Sinclair Broadcast Group Inc., according to the Wall Street Journal. The contracts expire at the end of the year.
And already this year, Time Warner reported that fees to TV channels were up 6 percent from a year earlier to $1 billion during the third quarter. For the first 9 months this year, Time Warner paid $3 billion in these fees, up 7 percent from a year earlier.
But, keep in mind, Time Warner’s move is purely marketing its opinion on how things should work.
It asks consumers to vote. Choose “Get Tough” and its response is “Thanks and welcome. With your help, we can push back against TV networks who are driving up the cost of cable TV.”
But pick “Roll over” and you get a second chance to choose the other answer.
Now, we don’t really know if Time Warner will really react to future negotiations based on feedback. Plus, if consumers were asked something more specific — say, get tough if ESPN wants to hike rates or get tough for Jewelry TV? — I’m sure the answers those questions would not be the same.
And of course, there’s no mention of the third choice: Let subscribers pay for only what they want to watch. Also known as a la carte, this option is, well, not an option. Time Warner’s a la carte stance is the same as the National Cable & Telecommunications Association position. The NCTA feels that if cable providers sold channels separately, consumers would pay more for fewer channels and cable providers would lose advertising revenues. Read its position HERE.
There are also other alternatives. Reuters writer Yinka Adegoke suggests that Time Warner shouldn’t build web sites but rather buy content companies like Comcast is trying to do with NBC Universal. The Associated Press report says Time Warner should stop spending money on shows that aren’t popular.
Cable is definitely in transition as it faces battle with online TV services offering viewers a la carte options, not to mention newer paid-TV competitors like Verizon FiOS and AT&T U-verse. Guess we’ll see how it plays out in the next month as we wait to hear how much more our cable bill will go up in 2010.
UPDATE, 12/7: Early results are in. See “400,000 consumers tell Time Warner to stop price hikes.”
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Here's a list of TV/mobile companies helping consumers one tweet at a time. 
I don’t think I should have to pay for channels that I don’t watch, like programs I can’t understand or if I’m not into sports, it should be or choice.
Soon with prices going up on everything no one will be able to afford to pay for anything, then we will see how the large corperations servive.
Don has lived in Redondo Beach for many years since I retired from the military in 1957. signed up for cable TV then the internet. Im and old man now i’m war disabled and retired. So all I have how is my computer and Cable TV. I owe TW money so it looks like I will lose my TV and computer soon. can’t keep up with the payments. It buy food or pay TW. So if prices go up, then im will not have anything.
I find it funny that all you guys are doing is complaining,
I want this… or I want that…
You guys complain but you still pay your cable bill every month. (Well some of you)
To the people who want to the so called “a la carte option”
Do you realize how much that would cost you, if you had to pay per channel?
Oh sure your local channels wouldn’t be so bad, but upper tier channels that do not have that many viewers? You would be stuck paying high prices where the cable copy breaks it up tries to divide the cost among there subscribers.
Everyone wants something for free, you want your cable for free; apply for a job at who ever is your service provider. Better yet cancel your service buy an antenna and get your local channels and stop bitching about the prices. Costs of business are going up, Cost of goods are going up, Cost of my pay check staying the same, it is up to you the consumer to see what you need and what you don’t need in life to live. Cable isn’t of them. If you’re bitching about TV prices going up try getting your fat ass off the couch and try doing something with your life instead of spending $120 a month to waste your life away.
Few Ideas…
Spend time with your family
Save the money go on a vacation
Go for a walk
You spent 5 minutes reading this now spend 5 minutes thinking of something to do besides watching TV
You are the consumer you are the idiot that keeps spending the money on your cable bill, you are the one the blame about prices going up because you are watching to much tv and the programs track how many viewers, more viewers = more money in there pocket, less viewers = less money in there pocket
Time Warner Cable is doing the right thing putting the choice in our hands instead of them just saying ok and passing the rate increase to the customer. Good for them, at least someone is standing up for you as a consumer.
Maybe you should stand up to your provider and cancel or find a alternative to watching TV
From what I can gather, Time Warner seems to avoid telling us how much of their increases go toward higher fees for individual channels, and how much goes straight into their own pocket.
So—if Time Warner “gets tough”, increases may be less, but TW will probably actually reap more dollars from them.
If the cost remained a few pennies for most channels, a la carte would be great for consumers. Because all channels would lose many subscribers, however, a lot of channels would disappear, and those who still wanted any cable channel would probably have to pay a lot more for it. Therefore, the downside of a la carte might be that you’d not only end up paying a higher total to keep the handful of channels you want, but also lose other channels you now have in the “bargain”. I’m sure that’s an outcome that TW wouldn’t mind manipulating.
If there is a raise in fees or we lose any of our chanels we’re leaving to another provider who can give us what we need. Time Warner will lose major business if they don’t have the chanels in question. As it is they are more expensive and so many customers were already considering the move. This would be a poor decision on their part.