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story category Viacom, Time Warner Cable Kiss, Make Up
Will return to regularly scheduled rate hikes for consumers
(old news - 08:46AM Friday Jan 02 2009)
tags: prices · competition · business · alternatives · bandwidth · cable · consumers · Time Warner Cable
Tipped by linxer See Profile
After a rather ugly dispute earlier this week, Time Warner Cable and Viacom have settled their differences. Time Warner Cable originally claimed Viacom wanted to charge them between 22 percent and 36 percent more per channel (later saying the number was 12%), and using an elaborate advertising assault, had threatened to pull all Viacom content (both online and off) if Time Warner Cable didn't comply. Apparently Time Warner Cable found a number they liked, as the two companies have struck an agreement on an unspecified increase. Of course that increase will be passed on to you shortly.

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Forums » Viacom, Time Warner Cable Kiss, Make Up
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Vchat20
Landing is the REAL challenge

join:2003-09-16
Warren, OH
clubs:

No happy medium

Really there is no ultimate solution to this that'll appease everyone. Viacom wants major profits and more subscriber money but Time Warner doesn't want to give it to them.

~If Time Warner would have given in to their demands, cable prices would have gone up and people would have bitched.
~If they held to their guns and cut out all Viacom programming, you'd have the people who want those channels bitching.
~If they rather decided to move those channels to another tier, you'd have the people bitching that 'I don't want to pay for an extra tier for channels I used to get standard'.
~They could have also done the tier thing and raised subscription rates so Viacom could get the same profit with less subscribers but that'd exacerbate the above issue.

But the actual outcome here was ultimately the best as it got Viacom to at least come down off their greedy fee requirements and keep the channels in place.

All in all though, you can't really start going after TW for this since it is all Viacom's doing to begin with and they've done it to so many other providers in the past as well with not-so-pleasant results.
--
I swear, some people should have pace-makers installed to free up the resources. Breathing and heart beat taxes their whole system, all of their brain cells wasted on life support.-two bit brains, and the second bit is wasted on parity! ~head_spaz

marigolds
Gainfully employed, finally
Premium,MVM
join:2002-05-13
Saint Louis, MO

Re: No happy medium

The tier option was likely not available. Viacom could only be moved to a separate tier if they agreed to be moved. Since this would have killed their ad revenue, there is really no way they would have agreed to it.

Vchat20
Landing is the REAL challenge

join:2003-09-16
Warren, OH
clubs:

Re: No happy medium

That too, which also adds to the dilemma at hand.

en102
Canadian, eh?

join:2001-01-26
Valencia, CA
·RoadRunner Cable
·DSL EXTREME

Re: No happy medium

Well, I at least got a nice credit of a month and then some for their mess ups with 'FX West' in Santa Clarita.
Its been off since before Xmas and replaced with 'Sleuth' on Standard Cable, (but works on digital) which contradicts their documented 2009 channel lineup, their online channel lineup, their TV guide channel lineup, etc.


I suspect that they don't pay much attention to channel lineups on analog anymore, as even their CS staff keeps asking me to check channel 106 (digital) even though I mention that its on basic cable, without a box. Channel 106 is 'snow' on CATV ;)

Those in Valencia (91355) - call in and demand a refund.

--
Canada = Hollywood North

rf_engineer

join:2003-08-04
USA

said by marigolds See Profile :

The tier option was likely not available. Viacom could only be moved to a separate tier if they agreed to be moved. Since this would have killed their ad revenue, there is really no way they would have agreed to it.
Do you know for a fact that the tier option wasn't available? The only way I could see that a tier/package option wasn't available was due to some previous agreement between TWC and Viacom. Obviously whatever agreement they had before ran out 12/31/08 24:00

I think that was really the only viable and equitable solution to this situation, considering things were at a stalemate. As I mentioned in a previous posting, TWC should have let Viacom charge whatever they wanted for the channels, TWC add a reasonable profit margin, and then throw the channels into a separate package. That way it's put up or shut up time for Viacom; they would have to price it correctly and deliver the right programming to attract subscribers to the package. Performance based agreements make sense, not this "we're Viacom and people will be pissed if you lose our channels, pay up" stuff.

marigolds
Gainfully employed, finally
Premium,MVM
join:2002-05-13
Saint Louis, MO

Re: No happy medium

FCC rules allow Viacom to write tier requirements into the contract. The contracts are confidential, but experience shows that nearly every channel on basic or expanded basic cable has a tier requirement.

Ray422
Premium
join:2002-03-04
Adger, AL
clubs:
·RoadRunner Cable

Awwww geez, it's just so terribly expensive to deliver that tv service to your household. Besides that increase; please don't forget that we will need to increase executive pay and bonuses by another 250 million in 2009.

We actually need a government bailout to help us through these tough times, things are just terrible. Thanks for your understanding on the gigantic new rate increase.

Vchat20
Landing is the REAL challenge

join:2003-09-16
Warren, OH
clubs:

Re: No happy medium

Well, you are always going to get the extremely out of whack CEO salaries. Tell me any publicly traded company not like this. And there are plenty of costs involved with simply everyday operation from customer service rep pay, plant maintenance, gas for trucks to do truck rolls, the list goes on. It's a vicious cycle of transfer of money between customers, employees, the content providers, etc.. While I am not denying that some cable rate raises are simply for increased profits for the cable co, it is certainly not always the case and this specific time is a perfect example.

Disregarding any complaints about rate increases as Karl likes to eagerly point out (and I should add was completely brought on by Viacom in this case considering the exorbitant increase they were originally asking for), Time Warner did the best damage control they were capable of and took a middle-of-the-road position here to appease everyone involved.

But really, this happens all the time. Just it's not as heavily publicised as this. The only time this came about is because Viacom decided to pull the 'dumb viewer' card and put TW in a bad light by plastering messages on all their channels acting as if it was all TW's fault for the channels disappearing.
--
I swear, some people should have pace-makers installed to free up the resources. Breathing and heart beat taxes their whole system, all of their brain cells wasted on life support.-two bit brains, and the second bit is wasted on parity! ~head_spaz

rawwhide
Zer0
Premium
join:2000-09-03
Zero
clubs:
·AT&T DSL Service

Time Warner Cable or Viacom?

I wish Time Warner would have dropped Viacom and made a stand. I hope you all don't wonder any longer why your cable bills keep going up, up, and up!! Poll: Time Warner Cable or Viacom?
--
See ma cap b1tch?

dr3yec

join:2002-12-19
00000

Re: Time Warner Cable or Viacom?

This is why I will never pay for tv and never have. Can we say overpriced shit.

Eat Me

join:2002-09-25
Sussex, NJ

Shoe on the other foot?

I'm glad Time Warner got a little taste of their anticompetitive medicine.
Warmachine99

join:2006-03-20
Pleasant Prairie, WI
·RoadRunner Cable

MTV? I dont need no stinking MTV.

As a Time Warner Cable subscriber, I looked at this whole situation this way. What channels would I loose that I actually watched if TWC stood their ground?

My answer was 1 channel out of the 19, Spike, and even that channel is only (maybe) watched for less than 5 hours in a months time.

As for the rest, no loss to me. To misquote the Dire Straits song: "I don't want or need MTV"

Now my cable rates are going to go up for something that I have no use for.

Now, if they had this disagreement with the Discovery channel, or the History channel, then I would be more than happy to pay a little more. But for all those crap ladened channels that are part of the MTV grouping? No thanks.
--
I've discovered that I often visit the state of confusion, and I know my way around pretty well.

PolarBear
The bear formerly known as aaron8301
Premium
join:2005-01-03
·CableOne

Re: MTV? I dont need no stinking MTV.

Amen. I'd happily pay more for the Discovery group of channels. I haven't watched MTV since 1995 (and I think I only watched it that late into the 90's because I was only 12 years old )
rayeger

join:2003-07-05
North Royalton, OH

This needs to stop

They need to make it a law that the content providers have a choice to make, they can either:

1. Make their money from advertising.
2. Charge the cable companies fees to carry their channels.

Not both as it is now, they are double dipping as far as I am concerned.
openbox9

join:2004-01-26
Alexandria, VA
·AT&T Southeast

Re: This needs to stop

Nothing forces pay TV companies to pay the content owners for their content as has been witnessed by a pay TV companies resisting/negotiating with the owners over the last several years. Also, the pay TV companies also receive income from advertising so you can't point only at the content producers.

idjk

@embarqhsd.net

Re: This needs to stop

Strange that OTA stations stay in business with the local ad money but national networks who change more for ads because they get nation wide coverage via cable, satellite, etc can't seem to make it without some bucks from the people providing the large audience.
Strange that the "commercial free" pay tv people now seem to have to charge us an arm and leg just to watch tv- with 20 min per hour of commercials, is there some "payola" going on here?
openbox9

join:2004-01-26
Alexandria, VA
·AT&T Southeast

Re: This needs to stop

I haven't looked at the financials of the content producers or distributors, but I suspect that they're making decent money. The national networks that broadcast OTA are leveraged with other business models and are connected to the content producers. I suspect that the quantity/quality of the content would decrease should they not receive ad revenue and carry revenue from the pay TV providers. High quality content production is not cheap.

limegrass69

join:2008-05-28
Cross River, NY

Re: This needs to stop

Many OTA broadcasters (especially those affiliated with a major TV network) receive compensation from cable companies in exchange for retransmission consent. There are many well documented cases of this.
openbox9

join:2004-01-26
Alexandria, VA
·AT&T Southeast

Re: This needs to stop

Yes, local broadcasters have a choice between receiving compensation from TV providers or must carry arrangements minus the compensation. I feel that the pay TV providers should treat local broadcasters no different in their exorbitant greed than they do the national conglomerates (which often own a lot of the local broadcasters btw). I went through a couple of retransmission disputes with my previous provider. Does nothing but drive me towards an OTA antenna and discontinuing my pay TV service.
axus

join:2001-06-18
Washington, DC
·Verizon Online DSL

A law saying "only this business model is allowed" is sort of arbitrary. Your goal is to get the shows you want while paying the minimum for your cable TV, while watching the least amount of commercials. There are more fair and efficient ways to accomplish that.

If you're going to pass a law, have it treat forced bundling as unfair trade. That way, your cable company can drop the channels that people don't want, or pay a lower price for them. Then "a la carte" would be possible, and Viacom couldn't pass the risk from their crappy shows onto the broadcasters.

Ultimately, it will make sense for every show to be sold on demand per episode, the ultimate "a la carte". Perhaps a "with commercials" version could be sold for a lower price.

mrchris
We don't miss you Bush
Premium
join:2002-10-01
North Babylon, NY

Do what's good..

Dump their stupid asses if you have other choices.
Ghostmaker

join:2003-01-20
Brunswick, OH

Let the end user pick the channels

Problem solved, If you want to watch it pay for it.
axus

join:2001-06-18
Washington, DC

money was at stake ;p

I'm sure some jerks on both sides got a bonus for their "excellent negotiating skills". To us they just look incompetent.

Lowtarget
Premium
join:2003-12-22
Alger, OH
clubs:

Re: money was at stake ;p

Good thing we are on a price lock for 2 years.

Jason Levine
Premium
join:2001-07-13
USA

Viacom's response was appalling.

We're Time Warner Cable subscribers and our kids love Noggin. However, we sided with Time Warner in this dispute. We wouldn't have been angry to see Noggin go blank rather than giving Viacom a 30%+ raise. We even prepared our older son for the possibility.

My wife called up Viacom to complain to them about their demanded rate hike. The minute the woman heard the words "Time Warner", she transferred my wife to a recording telling everyone how this whole situation was Time Warner's fault and we should call to complain to Time Warner. Sorry, Viacom. We've already looked at the facts, decided whom we side with, and decided who we wanted to complain to. Don't tell us to call Time Warner when we called to complain to you!
--
-Jason Levine
Support a children's charity. Buy a calendar and/or a photo book. Shooting For A Cause

icemannyr1

join:2001-04-11
Township Of Washington, NJ

Re: Viacom's response was appalling.

VIACOM was running ads on the radio Friday saying TimeWarner and Cablevision had taken VIACOM channel's off their systems.

That was 100% not true.

anno67

@rr.com

Viacomm and TWC

The fact is that in a competitive environment, TWC competing with FIOS could ill afford to loose Viacom. At the same time Viacomm networks such as MTV, VH1 have done very poorly in ratings. There are 2 networks that are of any value Nick and Palladia the rest have done poorly.
What is really low about Viacomm was that they aired this on Nick and said to kids, you can loose Dora or Spongebob. Now that's low, to go through the children like that. Why don't you take a kids lollypop or teddybear away. There is a way of putting that banner up without having to go to low methods.
If it wasn't for Nick...Time Warner probably would have let them pull the channels.

Frankly Time Warner didn't play hardball enough here. It needs to begin playing hardball with Showtime in particular.
Showtime has done really poorly over the last few years, and the one channel that is growing for Showtime which is the Smithsonian Channel Time Warner doesn't have. Nor does it have Showtime Interactive like the satellite companies do.
Forums » Viacom, Time Warner Cable Kiss, Make Up


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