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Re: Infrastructure improvements The original AP article on this story mentioned LARGER tiers and CHEAPER tiers, not smaller tiers.
quote:TWC also took a 7.3 BILLION dollar loss this year:
Time Warner Cable spokesman Alex Dudley said his company's trial, in Beaumont, Texas, had shown that the system is capable of metering and billing accurately. It will soon be expanded to four more markets, for now undisclosed, to give the company a better understanding of how the system works.
The intent behind charging by the gigabyte is to have subscribers who use the Internet more pay for the upgrades necessary for the company to keep up with increasing traffic, Dudley said.
"It's clear to us that customers want online video, which requires substantial investment in the network," Dudley said. "We're willing to make that, and we're trying to find an equitable way to distribute the cost of that investment."
Dudley said a "small but vocal percentage" of users in Beaumont were unhappy with the amount of data they could use (the top tier is 40 gigabytes per month). The company plans to address that by introducing plans with larger monthly "buckets" of data, as well as cheaper ones for casual users.
quote:So I'm not sure where people are seeing SMALLER tiers or lots of PROFITS at TWC...
In 2008, Time Warner Cable reported record cash flow, and the company increased its revenue in every service category, though growth rates decelerated as the year progressed, the recession worsened and competition ramped up. The company ended up experiencing operational losses in Q4 that wiped out financial gains from earlier in the year, leading to a fiscal-year loss of $7.3 billion.
During the frank and free-ranging Time Warner Cable Q4/FY 2008 conference call, TWC executives announced that they will be reducing headcount by 1,250 employees. CFO Rob Marcus said the company will be taking charges of $50 million to $100 million in 2009 associated with the separations.
If you have any legitimate suggestions for a different way to generate the billions of dollars necessary to rebuild our infrastructure, we're happy to hear you out.That question suggests Time Warner Cable, a very healthy and profitable company, is not already making enough revenue to perform very organic and necessary upgrades in order to remain competitive. That's not the case, Jeff. Time Warner Cable is very profitable, and DOCSIS 3.0 upgrades are relatively inexpensive. Particularly if upgrade locations are going to be selective.
Your own COO this morning on the conference call called DOCSIS 3.0 "a marketing ploy at this point," saying upgrades are "more about marketing noise than about reality," adding that TWC "will play the game where we need to." That lax attitude is because in many of your territories, there isn't much competition so upgrades aren't necessary -- not because the funds aren't there.
We think that charging for usage is an equitable way to generate the necessary revenue.Again, this suggests you don't already make a very healthy profit via monthly service charges, VoIP, TV revenue, and other less public money makers like DNS Redirection advertising or the sale of clickstream data (assuming you sell the latter). I'd love to see actual numbers that suggest there's so little revenue, an entirely new billing paradigm for bandwidth is in order. I ask this of every carrier who suggests metered billing is necessary -- and interestingly -- they can never provide it.
I think you'll simply wind up driving customers to competitors in a misguided attempt to please investors and crush alternative TV video delivery.