Time Warner Cable blames increased programming costs on NFL Network, Fox News, Pac-12 Network
Time Warner Cable's (NYSE: TWC) carriage deals with NFL Network, Fox News Channel, Pac-12 Network and other networks will see its programming costs increase by 10 percent this year, COO Rob Marcus said Tuesday.
Marcus told attendees at the Deutsche Bank 2013 Media, Internet & Telecom Conference that the MSO's programming costs increased just 5 percent in 2012, but he said deals that the MSO signed late last year will impact its profit margins. Time Warner Cable also signed a distribution agreement late last year with beIN Sport, which carries soccer programming, Marcus noted.
Time Warner Cable was one of the last major MSOs to agree to launch NFL Network and the NFL RedZone Channel. It signed a carriage deal with the league in September.
With programming costs making it more difficult to turn a profit by selling cable programming, Time Warner Cable will look to cut expenses by reducing the number of truck rolls to subscriber homes, Marcus said. The company will also rely more on customer service software to make it easier for subscribers to resolve issues through self-service programs, which could reduce the volume of calls to customer service representatives, he said.
"Those are things that will not only reduce costs, but will lead to our ability to deliver better service," Marcus added.
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