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Time Warner CEO Jeff Bewkes defends cable-business status quo

March 04, 2013|By Joe Flint
  • Time Warner CEO Jeff Bewkes.
Time Warner CEO Jeff Bewkes. (Associated Press )

This story has been corrected. See below for details.

Don't look for HBO to take a page from Netflix and make an entire season of one of its hit series, like "Game of Thrones," available to its subscribers in a single instant.

Speaking at the Deutsche Bank Media, Internet & Telecom Conference in Miami on Monday, Time Warner CEO Jeff Bewkes dismissed the idea of releasing an entire season of a TV show that way. 

"We don’t want to put it up all at once, we want the water cooler effect," Bewkes said.

The debate over how consumers best enjoy watching TV has heated up lately in the wake of Netflix's decision to release all the episodes for the first season of its new political thriller "House of Cards" on the first day it became available. Netflix does not release figures on how many people have watched the series but executives there have said it is a success for the company.

So-called binge viewing has become a popular way for consumers to catch up with series that have already been on television for a few seasons.

But traditional broadcast and cable networks typically need a decent audience from the get-go in order to attract the ad dollars that help cover the program costs. They can't just bet that people will catch up with a show after it has been on for a few seasons and continue to sink money into it regardless of ratings.

HBO and Showtime are commercial-free and typically look at other factors besides a show's audience size in determining the fate of a program. However, even they are not immune to ratings. For example, HBO's "Enlightened" has a very small audience and while the network was willing to bet on a second season, its odds of getting to a third one seem very long.

Bewkes noted that even though HBO may not make entire seasons available at once, episodes of its shows are offered on the pay channel's on-demand service after they air. That also means that one could wait for an entire season of a show to run its course and then watch all the episodes in a binge-viewing spree.

The current model for releasing TV episodes is not the only thing Bewkes isn't looking to change. He also defended the way programmers sell their channels to pay-TV distributors.

Known as bundling, it is when a programmer puts all of its cable networks into one package to sell to distributors. Last week, New York-based cable operator Cablevision Systems sued Viacom, claiming its bundling approach was illegal and made consumers pay for channels they didn't want.

"We don’t think the multichannel bundle is becoming a less good deal," Bewkes said, adding that so far there has been little desire from consumers for low-priced pay-TV packages that carry only a handful of channels.

"If the price is too high you would expect to see people revolting in some way," Bewkes said. "You don't see evidence of cord-cutting." 

Bewkes declined to comment on press speculation that the company is preparing to unload several magazines from its Time Inc. unit -- except to take a shot at the media.

"The press is very active," he said. "Who knows if they know what they are talking about?"

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A previous version of this post misidentified the name of the HBO show "Enlightened."

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