Turner Chief Explains How TV Industry Will Neutralize Netflix

Phil Kent, Turner Broadcasting

If there was ever any doubt that the animus towards Netflix (NSDQ: NFLX) runs deeper throughout Time Warner (NYSE: TWX) than chairman and CEO Jeff Bewkes, get a load of what one of his top lieutenants had to say at the Citigroup Global Entertainment, Media & Telecommunications Conference on Wednesday in Phoenix. Turner Broadcasting chairman and CEO Phil Kent talked in depth about how the TV business is circling the wagons to marginalize the upstart streaming service.

Addressing what he called “the elephant in the room,” Kent singled out Netflix as the fly in the ointment when it came to the syndicated acquisitions two of his biggest cable properties, TBS and TNT, count on as key to their businesses. He spoke of a dawning awareness throughout the TV industry “to the long-term effect to having top-tiered programming on SVOD services,” he said, referring specifically to Netlix. “We tell our suppliers, the studios we buy from: This is going to have a significant impact on what we’ll be willing to pay for programming or even bid at all.”

But if you thought Kent was being hard on the studios–Warner Bros. is actually a corporate sibling of Turner’s–that’s nothing compared to what he says the industry is doing to Netflix to effectively block Reed Hastings from getting his hands on premium TV series. The new and old broadcast sitcoms and dramas Turner pays billions for may never even get an opportunity to be on Netflix because Kent implied SVOD rights are being “frozen” in the latest rounds of dealmaking.

“I think there’s a heightened sense across the industry of the importance of freezing those rights, and that’s what you see us from us in the future,” said Kent. “We’re going back to other series on renewals and attempting successfully to retroactively freeze the SVOD rights.”

Kent also talked up what he positioned as “a fantastic consumer alternative to SVOD”: TV Everywhere. He spoke of the progress the cable operators’ authentication strategy was making, including an upcoming deal with Comcast (NSDQ: CMCSA) that he indicated would set the standard for programming deals in that nascent area.

But Kent is not without some measure of mercy. He did say that Netflix still has a seat at the table, but for the scraps. He talked about a deal between Netflix and Warner Bros. TV Distribution for the FX series “Nip/Tuck,” a program that drew little interest from the TNTs of the world.


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