Time Warner Cable Really Hates Online Video

Time Warner Cable subscribers won’t be able to watch premium cable services from Epix on its service anytime soon, as the cable provider has decided not to carry the network or its broadband and video on demand services. And at the heart of that decision is a recent deal by Epix to make its film catalog available through Netflix’s broadband streaming service, according to multiple reports.

Epix, which is little more than a year old and has backing and content from Viacom, Lionsgate and MGM, recently signed a five-year deal with Netflix reportedly worth $1 billion. That deal gives Netflix subscribers access to 3,000 titles through its Watch Instantly service. The only catch is that new releases won’t appear on Netflix until 90 days after they’ve already been shown by Verizon, Dish Network and other Epix distribution partners.

But Time Warner Cable sees that deal as a reason not to strike a deal with the fledgling cable programmer. The LA Times reports Time Warner Cable CFO Rob Marcus said at a conference that Epix “didn’t do itself any favors” by striking the deal, and that the Netflix agreement “cheapened its brand.” And a spokesperson for Time Warner Cable told The Wrap that it isn’t interested in doing a deal with Epix “in large part” due to the Netflix deal.

This isn’t the first time that online video has been a thorny issue for Time Warner Cable. Online distribution of broadcast content was reportedly one reason why Time Warner and Disney entered a prolonged and public battle over carriage fees for multiple ESPN and Disney brand channels, as well as some local ABC affiliates. But that fight ended with Time Warner Cable and Disney announcing the first authenticated ESPN TV Everywhere service, making live sports content from the network available online to Time Warner Cable subscribers.

Of course, the new broadband ESPN service will only be available to cable subscribers who log in and prove that they pay for ESPN through their cable subscriptions. Epix content, on the other hand, is freely available to anyone who pays $8.99 a month for a Netflix subscription. The theme here seems to be that Time Warner Cable is ok with online video, but only if it can control who views it.

Of course, if cable subscribers begin to leave or switch to broadband-only plans, subscribing to services like Netflix or Hulu Plus for their content instead, companies like Time Warner Cable will have to find other ways to boost revenues. One possibility is rolling out tiered pricing plans for broadband — ensuring that those who use video sites as a cable substitute will pay more than those who just use broadband for email or other data-light applications.

Photo courtesy of Flickr user The Consumerist.

Related content on GigaOM Pro: How Online Video Is Shaping the Next Round of Retrans Fights (subscription required)

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