While his counterparts at CBS (NYSE: CBS) and Comcast (NSDQ: CMCSA) offer new streaming video deals with Netflix (NSDQ: NFLX) and Amazon (NSDQ: AMZN) as bright spots in second-quarter earnings, Time Warner (NYSE: TWX) CEO Jeff Bewkes’ focus is more on how his company is expanding access to its own content though products like HBO Go and live in-app streaming of CNN.
It’s not that Bewkes doesn’t want the money. He just wants more of it and without external pressure to show instant results, he thinks Time Warner will make more by waiting. In a call with analysts and investors to discuss upbeat second-quarter results for Time Warner, Bewkes said Warner Bros., which has the biggest film and movie library, has “ongoing discussions” with all of the digital outlets — he singled out Apple (NSDQ: AAPL), Amazon and Netflix — to license series and movies. Asked by Credit Suisse analyst Spencer Wang for an update on TW’s “conservative” approach, Bewkes replied:
“I think we have been pretty clear generally that we’re eager to maximize the value of all of our series and movies and we want to do it in a way which adds to the value of these over their lifetime — not detracts from it. … We had thought that some of the sales that we saw content owners make to various digital outlets actually undervalued or reduced the lifetime stream of earnings for those products. So we didn’t want to do that. And we think there are some good opportunities from all the digital players, including Netflix.”
Warner Bros. already has a streaming deal with Netflix for some out-of-production shows (including all 100 episodes of Nip/Tuck and catalog films but it’s not as broad or deep as it could be.
But Bewkes also insists pricing isn’t the sticking point, explaining, “We can make structures that accommodate the different positions that digital distributors are in as they try to build their businesses.” But, he added, subscription video on demand (SVOD) services like Netfliz or Amazon are good for older content but not for everything: “… If you think of all the big series or the movie products that are out there in the relatively early windows, that’s probably not the right outlet for the newer, higher value content, because it has so much money behind it, you know.”
Why not make short-term deals while they figure it out? That’s the approach some programmers are taking but Bewkes wouldn’t commit to anything, even on that scale.
HBO Go: What Bewkes and TW have committed to on a major scale is making much of the company’s content available across platforms for current subscribers, the implementation of the “TV Everywhere” strategy he starting evangelizing more than two years ago. HBO Go moved beyond the browser to iOS and Android in May. The apps have been downloaded more than four million times since then; internal research shows 85 percent of the users are watching more HBO and with higher satisfaction levels. In the second half of the year, TW plans to make HBO Go available on connected TVs, game consoles and other connected devices. It’s also going to continue international expansion with Brazil and Mexico this year, then Asia in 2012.
Streaming Turner nets: Bewkes said about 7 million households have “TV Everywhere” access to some Turner networks. CNN added authenticated live streaming last month and other apps are en route. As important, it’s covered in C3 data, which, says Bewkes, makes Turner “agnostic to whether viewers watch our shows on TVs, PCs or mobile devices.”
UltraViolet: The good news: Warner Bros. is set to deliver its first digital movie as part of UltraViolet, the Digital Entertainment Content Ecosystem (DECE) effort to make purchased movies available across devices. The bad news? It’s the woefully underperforming Green Lantern so may not be much of a test. After that, though, most of the new releases should be available through UV.
Time Warner will integrate UltraViolet with recently acquired Flixster. New versions of the movie service will allow users to manage their UltraViolet-enabled purchases. It should be in beta this week and launch in the fall. Here’s how Bekwes describes the new program:
Remember with UltraViolet, if you go and buy a physical DVD, you will have it in the cloud as you walk out of the store. If you buy an electronic copy of the movie, from either a cable operator or any electronic retailer, you will also have a copy that is up in the cloud that you can move from device to device. If you want to take your old DVDs into retailers and have them put into the cloud and therefore available for you to move from device to device, you will be able to do that also.