Time Warner Cable CEO: Company May Drop Expensive, Low-Rated Channels

Glenn Britt
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Time Warner Cable CEO Glenn Britt's compensation grew 9% last year to $17.4 million. His base salary -- $1.25 million -- was the same as it was in 2002 and his compensation is roughly in line with CEOs at other such providers of TV services as DirecTV, Dish Network, AT&T, Cablevision and Comcast. Nearly half of Britt's compensation came by way of non-equity incentives, while stock and options amounted to $7.4 million. His compensation also included $186,000 for personal use of corporate-owned aircraft.

??Glenn Britt tells a UBS investor conference that pay TV giants' payments to content companies are "out of whack." ??

?NEW YORK - Time Warner Cable CEO Glenn Britt on Monday once again warned that his company could drop weaker-performing cable networks as pay TV giants continue to pay more in channel carriage deals. ? ?

But the usually restrained executive used some strong language at the end of a year that saw several extended carriage disputes between Hollywood giants and pay TV firms.

Speaking here at the 40th UBS annual Global Media and Communications Conference, Britt said that since 2008, TWC's programming cost per customer is up 30 percent. With consumer prices up 10 percent and the firm's video services costing 15 percent more since then, the money paid to content companies is "out of whack," he said. "It's out of touch with consumers. It can't continue that way for another 10 or 20 years."? ?

Suggesting that content companies set to speak at the conference later would likely gloat about the continued value of their content, he said "I don't have any magic bullet about this." But Britt warned: "We are going to take a hard look at each service. Services that cost too much...we're going to drop them. Or we are going to put them on a different tier."

??The CEO also said that pay TV companies have accumulated networks over the years that "hardly anybody watches," with with content firms taking full distribution as a "birth right." Said Britt: "If we want to keep this going, we need to get the prices of packages lower."

Asked about pay TV subscriber trends, Britt said "the economy is still bouncing around the bottom." Household formation, a key metric, is still weak, Britt also said. ??Asked about cord cutting, he reiterated that "it appears to be fairly minor at the moment." A lot of big online viewing happens in households that also have pay TV subscriptions, he added. ??Once again, he put some blame on content giants. "Programming and packages keep getting more and more expensive," Britt said. "This stuff is just starting to cost too much."

??Asked what the pay TV business would look like in an a la carte world, where consumers pay only for channels they want, Britt said it would look “a lot more like Broadway theaters.”

Later at the conference, DirecTV Latin America president Bruce Churchill said that his company has also seen higher programming costs, particularly for sports programming. But he said that per-subscriber programming costs are not up that much. In fact, the firm's programming costs are flat to down in some cases in recent years, he said.

Email: Georg.Szalai@thr.com

Twitter: @georgszalai