IP: what was that about the price of convenience?

[David Farber <dave () farber net>]

> Date: Sun, 13 Jan 2002 05:45:39 -0500
> To: farber () cis upenn edu
> From: Esther Dyson <edyson () edventure com>
>
>
> Saturday, January 05, 2002
> A $230 a Month Cable Bill?
> Time Warner cable aims sky high
> By Phyllis Furman,  Daily News Business Writer
> Get ready for some sticker shock: Time Warner Cable's fixing to ramp up 
> your monthly cable bill — to $230.
> But Time Warner Cable won't just be charging for basic cable service.
> In a bid to squeeze the maximum juice out of its cable wires, the AOL Time 
> Warner-owned unit is set to pitch customers with a menu of new services 
> from movies on demand, to high speed data, to local phone service.
> This is the year that AOL Time Warner will look to cash in on its nearly 
> $5 billion investment in upgrading its cable systems, which service 12.7 
> million customers nationwide, including 1.2 million in New York City.
> The media empire's chief operating officer, Bob Pittman, has told 
> investors that Time Warner Cable's goal is to jack up the company's cable 
> revenues as it rolls out its new services to a level nearly six times 
> today's average $40 basic service bill.
> "We spent between $4 billion and $5 billion to upgrade with fiber optics," 
> said Time Warner Cable spokesman Mike Luftman, calling the company's cable 
> systems, "the most powerful two-way systems in the world."
> Squeezing more profits from Time Warner Cable is a top priority for AOL 
> Time Warner, which is under pressure to please Wall Street.
> The company, which recently lost to Comcast in a bid for AT&T Broadband, 
> is expected to cut profit forecasts again in a meeting with analysts on Monday.
> The meeting will be a chance for newly named CEO Dick Parsons to lower 
> expectations for 2002, so he can impress investors later by beating 
> targets. The company has been hit by an ad sale slump and slowdown in 
> subscriber growth at its AOL unit.
> Over the next 12 months, the cable division plans to aggressively launch 
> video on demand, allowing customers who have digital set top boxes to 
> order from hundreds of movies with a flick of their remote control.
> According to Bloomberg News, AOL Time Warner could get as much as $100 
> million in annual sales from movies on demand.
> Up next: local phone service, to be offered first in Florida later this 
> year and eventually in New York, though no firm time frame has been set, 
> Luftman said.
> Time Warner Cable is already offering customers several Internet Service 
> Providers, including its own AOL and Roadrunner services as well as Earthlink.
> The cable company is betting consumers will see the value of one-stop 
> shopping. But first Time Warner Cable will have get customers past the 
> sticker shock of seeing $230 on their bill.
> Media investor Uri Landesman called the $230 goal "aggressive" but said a 
> $200 bill is "possible."
> "I think people will get over the sticker shock," he added. "They will 
> like the convenience."
>
>
>
>
> Esther Dyson                    Always make new mistakes!
> chairman, EDventure Holdings
> writer, Release 3.0 (on Website below)
> edyson () edventure com
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