Cable Technology Feature Article
Report: TWC CEO Glenn Britt to Retire
By Tara Seals, TMCnet Contributor
Long time Time Warner (News - Alert) Cable (TWC) CEO Glenn Britt will step down from the helm of the number two U.S. cable company when his term is up at the end of the year, sources said. Britt is leaving in his wake an ongoing, high profile conversation that he started around programming costs.
Britt, who has been atop the TWC empire for more than 10 years, is planning to retire, according to the Wall Street Journal. Citing “a person familiar with the situation,” the Journal said that Rob Marcus, TWC’s COO, is the top candidate to replace Britt.
The news comes as TWC reported a nine percent decrease in its quarterly profit. Profit slipped to $513 million or $1.68 a share, from $564 million or $1.75 a share, a year earlier. Revenue increased 9.9 percent to $5.49 billion.
It also saw poor video subscriber results once again in the fourth quarter of 2012. The operator lost 129,000 video subscribers, which is flat year-on-year but a slight improvement over Q3, when it lost 140,000 net video subscribers. But worryingly, it also added just 75,000 new broadband subscribers in the fourth quarter, down from 117,000 a year ago.
"We've been losing too many customers when their promotions expire," said Marcus, during the earnings call. "We need to keep our customers happy."
TWC also needs to keep a handle on programming costs, according to Britt—an area where he has been a leading voice for the pay-TV community. The cost of carriage and retransmission fees was up 5.1 percent in the quarter. On the conference call, Britt said that programming has jumped a full 32 percent in the last four years. It’s a cost it has had to pass along to the consumer, he added: the MSO has increased residential video prices by 16 percent.
To remedy the situation, at least partially, Britt has instituted a policy of dropping or repositioning low-rated but no less expensive cable nets. "As our programming contracts come up for renewal, we're going to take a hard look at each service,” Britt said at the UBS Global Media and Communications Conference in New York. “Those services that cost too much relative to the viewership or value of those services, we're going to drop them, or we may put them on a different tier."
The company put its money where its mouth is when it decided in December to not renew carriage for arts-programming network Ovation, in a unilateral action. It dropped the network when its contract expired at midnight on Dec. 31 2012.
On the Q4 call however, he added that "the actions we're taking aren't going to dramatically change the trajectory of programming costs," he noted, because sports programming "keep[s] getting more and more expensive and that's where most of the money is."
Britt is a long-term company man. He joined Time Inc. (News - Alert) in 1972, and was named president of Time Warner Cable in 1999 before being named CEO in 2001. Britt's latest employment contract, signed in 2011, paid him a base salary of $1.25 million and an annual bonus of up to $17 million, the WSJ said.
Edited by Jamie Epstein