Time Warner eyeing premium VOD film releases

CFO says firm will experiment with plan early next year

NEW YORK -- Time Warner is planning to experiment with premium VOD film releases as early as early next year, CFO John Martin told an investor conference here Thursday.

Price points, exact release windows and other issues will have to be tested, but the industry is currently looking at a $20-$30 price range, he said at the Goldman Sachs Communacopia conference.

Studios have been considering bringing films to homes in a premium VOD window 30-60 days after their theatrical release.

Asked by The Hollywood Reporter after his conference appearance about what type of content may play well in the emerging new window, Martin said that will also be determined by experimentation.

Discussing his firm's 28 days release windows with Netflix and Redbox, Martin said they have worked out well financially for his company. Earlier at the conference, Lionsgate vice chairman Michael Burns had said his firm has done well with Redbox without a 28 day delay.

Time Warner's Martin on Thursday also talked about the recurring conference theme of possible "cord cutting," or fears that consumers are canceling their cable subscriptions as more content is available online.

"I do think it's a little bit overblown, Martin said about that concern.

He argued that over the short-term, so-called "over-the-top" video services, which provide video content to TV sets via the Internet, will only be an add-on as they lack key content breadth and depth.

Longer-term, such services would only become major players if they are "just plain better than what consumers get today," Martin argued.

But even then, content giants will have control levers. "We are not about to undermine our own economics," he said. "We are not going to under-price our content.

Ultimately, we are economic animals, and we're going to move where the money is."

Asked about TV advertising trends, Martin said fourth-quarter ad prices are pacing 20% above upfront levels with strength across categories, including auto and financial services. "There is no signal that there is a pullback on the horizon," he said, calling overall TV ad momentum "really strong."
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