TWC's Marcus: IP-only apps already opening set-top options

Describing himself as "highly skeptical" of FCC Chairman Tom Wheeler's proposal for new rules governing pay-TV set-tops, Time Warner Cable (NYSE: TWC) Chairman and CEO Rob Marcus said 20 percent of his company's customers are already using multiscreen apps to watch programming on myriad third-party devices in the home.

rob marcus


"From what I can glean, it appears to be that this is an attempt to create regulation that is unnecessary given the advances made by market forces," Marcus told investors during TWC's fourth quarter earnings call.

Yesterday, Wheeler said he was proposing rule changes that would "unlock" pay-TV subscriptions to work with third-party devices like TiVo set-tops. The vast majority of pay-TV consumers, he said, pay too much to lease set-tops from operators, and more choice is needed.

Among their myriad issues with Wheeler's proposal, pay-TV industry denizens wonder why new regulation is needed when their business is moving to IP-only delivering mechanisms that require no set-top at all.

For its part, TWC is testing IP-only delivery in New York. "It eliminates the need for a leased set-top," Marcus said.

Calling Wheeler's somewhat vague declaration Wednesday "a little hard to decipher," he added, "I want to reserve judgement, but I'm highly skeptical."

TWC's earnings presentation Thursday was a bit anti-climactic, given that the MSO had already released its subscriber numbers a month early. The company finished 2015 with a net gain of 32,000 video subscribers, the first time that it has finished in the black since before the Great Recession. It added 54,000 video subs in the fourth quarter. 

It also added 281,000 broadband users for the fourth quarter and 1 million for all of 2015.

Marcus attributed much of these gains to improvements in customer service -- truck rolls were down 19 percent year over year, for example. Meanwhile, the MSO's TWC Maxx advanced video platform is now deployed in more than 40 percent of its footprint.

TWC reported a 4.9 percent improvement in consolidated net revenue to $6.07 billion for the quarter. Operating income declined 8.2 percent to $1.12 billion. 

Marcus demurred on giving guidance pending the proposed takeover of his company by Charter Communications. He said he hoped to accelerate the review of the deal by California regulators, who aren't on track to complete their work until June. 

Asked about competition from Google Fiber in L.A., he said: "We think that because of the experience we've had competing with Google Fiber in Kansas City, we're in a better position to compete with them wherever they end up going … But whatever ends up happening in L.A., I think we're years out."

For more:
- read this TWC investor relations page

Special report: FierceCable's fourth quarter earnings calendar

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