Video services

Cincinnati Bell Joins Weight Watchers Club

Add Cincinnati Bell to the roster of US pay-TV providers seeking to market skinny TV bundles to subscribers in an effort to stave off customer churn.

Cincinnati Bell Inc. (NYSE: CBB), an Ohio-based independent telco with 108,000 Fioptics video subscribers, said it plans to join the skinny TV stampede next month with the launch of its "Fioptics MyTV" offering. It will thus join such other traditional pay-TV stalwarts as Dish Network LLC (Nasdaq: DISH), Comcast Corp. (Nasdaq: CMCSA, CMCSK), Verizon Communications Inc. (NYSE: VZ) and Charter Communications Inc. in offering lower-cost, slimmed-down entertainment packages to its customers. (See Cable Embraces Skinny TV Bundles.)

Similar to Verizon with its Custom TV bundle, Cincinnati Bell is only shedding some of its weight, though, not most of it. Costing $29.99 a month, the MyTV starter packages will still include more than 50 channels, including such well-known cable networks as AMC, Discovery Channel and HGTV. Subscribers will then need to pick one of the provider's genre packages as an add-on, paying an extra $6 to $25 a month for smaller specialty bundles focusing on sports, kids & family, or entertainment.

But the Ohio telco will likely be seeking more favorable results than Verizon has seen with Custom TV. While the skinny bundle is catching on with Verizon customers, the company has reported that it is also cannibalizing its main FiOS TV service to some extent, cutting into its overall video revenues. (See Skinny Bundles Sock FiOS Video Revenues.)

Cincinnati Bell will offer MyTV as a standalone service to its FTTH customers. Or they will be able to bundle it with the company's broadband service, which offers data download speeds as high as 1 Gbit/s.

Want to know more about pay-TV subscriber trends? Check out our dedicated video services content channel here on Light Reading.

The move comes as other pay-TV providers grapple with how best to meet customer demand for less pricey services while still maintaining their bottom lines. Although numerous providers are now experimenting with skinnier bundles, most still insist that their traditional heavy bundles make the most sense for most customers.

In their respective companies' recent fourth-quarter earnings calls, Comcast Cable CEO Neil Smit, Time Warner Cable Inc. (NYSE: TWC) Chairman & CEO Rob Marcus and Charter President & CEO Tom Rutledge all argued that their conventional bundles are still the way to go for the overwhelming majority of their cable customers. Rutledge, for instance, noted just yesterday that 96% of Charter's 4.3 million video subscribers still opt for expanded basic cable packages or higher.

— Alan Breznick, Cable/Video Practice Leader, Light Reading

kq4ym 2/10/2016 | 10:20:16 AM
Re: Broken chains It's always curious to hear from the exexs and the PR folks trying to upsell. One one hand as noted they have to figure "how best to meet customer demand for less pricey services while still maintaining their bottom lines," and on the other hand look to the future and balance profits down the road in a competivive world with immediate revenue.
mendyk 2/8/2016 | 3:53:57 PM
Re: Broken chains Seven -- I don't think we disagree all that much. Well, except for the CEO-as-employee thing. Technically, that's accurate. In reality, calling a CEO an employee is like calling the President a civil service worker. Companies tend to lose their way when long-term commitment gets muscled out by short-term agendas. I wouldn't call people like Carl Icahn day traders, but he does what he does to flip properties. What happens to those properties after the flip is of no interest.
brooks7 2/8/2016 | 3:38:53 PM
Re: Broken chains The day traders are never the focus of a company and if the company is smart it will focus on institutional investors to isolate itself from that crowd.  We used to try to have 75% or so institutional investors.

I am confused on why you are so unhappy that an owner - no matter how you want to categorize it - wants the company to have a return on investment.

One of the big challenges, particularly in tech investing is that these firms want P/E ratios like a growth stock.  Let's use Cisco as an example.  Why would I classify Cisco as much different than Proctor and Gamble?  They are both large diverse companies with modest earnings and top line growth.  But Cisco wants to command a P/E of 30 - 40 (Chambers has always pushed for that).  Why should I give Cisco a P/E that equates to a PEG of more than 1?

Let's use Adtran as another example.  They have always been a company that has a number of overlapping product life cycles.  When they have a good winner, the company grows well for a short period of time.  Then the company goes back to a normal slow growth cycle.  During those upticks, I see analysts (and LR quotes them) who talk about the great trajectory that they are on.  So people overbid the stock.  When the growth slows, the stock price gets oversold.  

Listen to Quarterly Conference Calls.  They are Sales Calls for the stock.  Each company touts how things are great - pointing at facts that support a growth story for top and bottom line for the company.  Most of the time, the analysts don't question things.  For example.  I used to do a quarterly piece on Cyan during earnings.  They would talk about how Windstream would come back as a customer.  I listened to Windstream and they talked about how they had just completed a CAPEX spending bubble. So, why was nobody - and I mean nobody - connecting the dots here?

And I am sorry but the CEO of any public company is just an employee.  He is an employee that gets to hire his or her boss, the Board of Directors.  They may have options or RSUs but other than folks like Chambers they still get a whole lot of their comp from Salary and Bonus.  They get more severance because Directors want to be on their next Board.  These employees often work in direct conflict of the best interest of the owners of the company - the shareholders.

You should review what is going on at Autodesk.  They are presenting numbers right now that are gibberish.  They are doing this because they are moving from selling software to a SaaS model.  Their old numbers have no relationship to where they are today and we won't be able to judge the new model until the transition is complete.  But because they told the shareholders what they are doing and why they are doing it, their share price has not collapsed.  Which is what other companies need to do.  Start being honest with shareholders.


mendyk 2/8/2016 | 3:12:27 PM
Re: Broken chains "Owners" implies (at least to me) a long-term interest in a company. "Investors" implies (again, to me) stockholders whose interest lies in the short-term share price. Top executives typically are compensated in part with company shares. The good ones align their interests with owners. The less good ones make decisions that are favored by investors. I wouldn't call top executives "employees" because they generally get a little more than two weeks' notice and a few weeks of severance pay when it comes time to part ways.
brooks7 2/8/2016 | 3:03:08 PM
Re: Broken chains Dennis,

You seem to dislike "investors".  Can we call them "owners" instead?  And call executive management, "highly compensated employees"?

mendyk 2/8/2016 | 12:05:23 PM
Re: Broken chains It looks like a common issue for most businesses -- whether to sacrifice revenue for improved margins. "Investors" want it both ways, which is why, like a certain segment of the U.S. voting population, they are usually cranky and angry.
alanbreznick 2/8/2016 | 12:00:51 PM
Re: Broken chains Yep, Dennis. It definitely is. But it's also furher evidence that some programmers are finding it tough to let go. This process will ikely take the rst of the decade, if not longer.  
alanbreznick 2/8/2016 | 11:59:25 AM
Re: Broken chains Yep, Daniel. ESPN is clearly hurting. They need to come up with a new business model to support all their secondary channels. And they need to find a way to go OTT sooner rather than later. 
danielcawrey 2/5/2016 | 4:43:41 PM
Re: Broken chains The biggest loser in this movement towards skinny packages is ESPN. Already I have been reading about the fact that ESPN has had to cut back its expenditures as the fat times may be ending.

Many people pay for channels they don't want, and they have had enough. The cable companies are listening. 
mendyk 2/5/2016 | 11:41:11 AM
Broken chains Alan -- Is this further confirmation that video service providers are breaking free of the de facto "must-carry" deals with the likes of Disney and other bloated content aggregators?
Sign In