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Time Warner Expands Start Over

Alan Breznick
11/27/2006
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Pleased with the initial customer response to its new network DVR service, Time Warner Cable Inc. (NYSE: TWC) has launched the service in three more markets and plans numerous more market rollouts over the next few months.

Time Warner, which introduced the "Start Over" product in Columbia, S.C., almost exactly a year ago, is now expanding the limited time-shifting service to San Antonio, Greensboro/Winston-Salem, N.C., and Rochester, N.Y. Plans call for extending Start Over to other, undisclosed markets across the U.S. throughout 2007 and beyond.

"We will continue rolling it out," says Justin Venech, a Time Warner Cable spokesman. "Our plans are to roll it out to all our divisions."

Start Over, available for free to all digital cable subscribers in each market, allows viewers to restart some shows in progress without any advance planning or new home recording gear, just by pressing the “select” button on their cable remotes. Often described as an advertiser-friendly "DVR-lite" service, it also lets viewers pause and rewind shows, just as they could with regular DVRs, but not fast-forward through commercials.

Along with expanding "Start Over" to more markets, Time Warner is boosting the number of cable and broadcast networks covered by the service. Launched in Columbia with about 50 enabled channels, the service now encompasses 93 channels. Time Warner officials, who are targeting 150 channels as "the sweet spot" for subscribers, say the lineup will soon grow to 115 channels.

In addition, MSO executives are looking at extending the window for playback of shows and expanding the number of enabled programs. Unlike Cablevision Systems Corp. (NYSE: CVC), which has been unable to launch a more ambitious network DVR service because of legal duels with network programmers over copyright issues, Time Warner has avoided legal problems by meticulously negotiating programming rights deals for each show.

Programmers prefer Start Over over Cablevision's proposed product because the more modest Time Warner service doesn't let users keep copies of the recorded programs. Plus, unlike Cablevision's planned service, Start Over doesn't let viewers skip through or past commercials.

Finally, Time Warner is toying with introducing a complementary time-shifting service called "Look Back." This proposed service would enable viewers to watch a program after its scheduled run time on the same night.

The moves come as early customer research in Columbia shows strong interest in Start Over among the system's 150,000 digital cable subscribers. Time Warner's surveys indicate that 70 percent of its digital cable subscribers use the feature at least once a month. In fact, the average subscriber uses the service seven to eight times a month.

Moreover, more than half of Start Over users, or 56 percent, say the service makes watching TV more convenient. Over two-thirds of users, or 68 percent, say it adds value to their digital cable subscription. And about two-fifths of users, or 41 percent, say it makes them more likely to keep their digital cable packages.

The initial popularity of Start Over has spurred some almost comical intramural scrapping among several of the cable industry's leading video-on-demand (VOD) vendors, including Motorola Inc. (NYSE: MOT), which just took over VOD vendor Broadbus Technologies Inc. , Concurrent Computer Corp. (Nasdaq: CCUR), and Cisco Systems Inc. (Nasdaq: CSCO), which just took over Arroyo Video Solutions. The three equipment suppliers, who can each rightly claim credit for helping Time Warner introduce Start Over in at least one market, are all trying to position themselves as the prime engine behind the service. (See Sparring Over Start Over.)

Start Over's early success has also prompted other cable operators to take a close look at the Time Warner model and consider launching their own versions of the service. Cable tech vendors say other MSOs are weighing similar moves.

"We've gotten inquiries from a number of customers," says Jim Brickmeier, director of program management and application engineering for Concurrent. "We might see similar deployments in the next year."

But all the other MSOs will likely trail far behind Time Warner, which has been the only cable operator to sign rights pacts with network programmers so far. For instance, VOD vendors now expect Cablevision to be mired in its legal battle with programmers for as long as a couple of years.

— Alan Breznick, Site Editor, Cable Digital News

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