Time Warner Cable Inc.
) has decided to restructure its bundled offerings for new
subscribers. The second largest cable MSO (multi-service
operator) in the U.S. is promoting two revamped packages. The
first one is the Starter TV package, which will be available for
$19.99 per month for the first year and will include over 20 TV
channels including popular networks and local TV channels.
The second one is Starter TV with HBO, which will be available
for $29.99 per month for the first year and will include the same
channels as Starter TV, but together with access to HBO
One of these offerings includes the price of the set-top box
and taxes. Last October,
), the largest cable MSO in the U.S., began its offer of a new
package called "Blast Plus".
This package offers local channels, video-on-demand,
streampix, popular networks like CNN, A&E and Comedy Central
together with HBO and HBO Go. Blast Plus is available for $49.99
for the first six months.
We believe the restructuring of the bundled service is an
attempt by Time Warner Cable to restrict its huge TV subscriber
losses. In Aug 2013, the company faced a month long blackout of
CBS network over programming contract renewal disputes with
In the third quarter of 2013, Time Warner Cable lost a
whopping 306,000 residential pay-TV subscribers primarily due to
the CBS network blackout.
A recent analysis by Leichtman Research Group Inc. revealed
that the cable TV operators in the U.S. are gradually losing hold
on the pay-TV market. Internal dynamics of the pay-TV markets are
slowly shifting toward fiber-based video offerings of large
telecom and satellite TV operators.
Leichtman stated that the top nine U.S. cable TV operators
suffered a net loss of 600,643 customers in the third quarter of
2013. This was the cable TV industry's biggest net loss after the
third quarter of 2010.
Recently, the Wall Street Journal reported that cable MSO
Charter Communications Inc.
) is trying hard to reach an agreement with several banks to
raise $25 billion in order to acquire Time Warner Cable.
Industry resources also reported that Comcast may join hands
with Charter or may offer an individual bid for Time Warner
Cable. The stock currently carriers a Zacks Rank #3
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