MUMBAI: The opening day of the 38th annual UBS Global Media and Communications Conference was dominated by cord cutting and Netflix.
Investors taking part were concerned that pay TV subscribers may engage in ‘cord cutting‘ and exchange their cable bills for free or cheap TV content through the internet.
Netflix has been named as the prime driver of cord-cutting among consumers who ditch traditional cable and satellite subscription services to go with internet-based video services and the so-called ‘over the top‘ providers. The Los Gatos-based company has been making headlines with its series of licensing deals in the recent months.
Time Warner CEO Jeff Bewkes expressed skepticism about Netflix‘s move of shifting its focus from physical distribution of DVDs through the mail to web streaming. He termed Netflix‘s willingness to pay $100,000 per episode for new TV shows airing this fall, as ‘a measly little offer‘ when compared to the hundreds of millions of dollars networks and cable TV operators pay for shows from their first airing right through to the DVD sales.
On the other hand, HDNet founder and CEO Mark Cuban said that "Netflix has done a phenomenal job" and has helped the content companies a lot. However, he predicted that cable and satellite operators will bring out their own web-streaming services by paying for added content rights, indicating that any cord cutting drift would be brief.
Slingbox founder Blake Krikorian agreed with Cuban and said that the content companies can also do their bit by ensuring the unavailability of free content online and authentication of all web content that would make it available only to pay TV subscribers. He argued that Netflix and others "would never exist" if TV distributors would have met its consumer needs.
Time Warner Cable chairman, president and CEO Glenn Britt asserted that his team still "can‘t find any meaningful evidence of cord cutting...other than in very, very small numbers." He went on to term Netflix‘s online streaming service and other web offers as just a supplement to pay TV service and not a substitute because their content is "fairly thin" and "not that great."
Agreeing with Britt, CBS research chief David Poltrack said that the discussion on cord cutting was being "overblown."
