Time Warner and Comcast are among six U.S. cable-television companies that plan to offer packages of family-friendly channels in response...
Time Warner and Comcast are among six U.S. cable-television companies that plan to offer packages of family-friendly channels in response to government pressure to curb indecency.
The packages may be offered as an option to customers who have digital cable service as early as the first quarter, Kyle McSlarrow, president of the National Cable & Telecommunications Association, told the U.S. Senate Commerce Committee on Monday.
Offering a grouping of family programs may appease Federal Communications Commission Chairman Kevin Martin and lawmakers, who have been pushing for even more severe measures such as selling cable channels individually or agreeing to decency standards. Staying ahead of lawmakers and regulators may also help limit the severity of any new rules.
“It’s a way for the cable industry to show good faith versus waiting for any mandated solutions,” said Aryeh Bourkoff, an analyst at financial-management company UBS in New York.
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Advance/Newhouse, Insight, Midcontinent and Bresnan also plan family groupings, McSlarrow said. Charter and Cox said Monday they are also considering changes.
Remaining companies, including satellite-TV broadcasters, will “get the message” and follow suit, Senate Commerce Committee Chairman Ted Stevens, R-Alaska, said after the hearing.
Introducing packages suitable for all ages would group programs from channels such as Walt Disney Co.’s ABC Family and the Disney Channel with Viacom’s Nickelodeon. Now, Time Warner, Comcast and others don’t differentiate, offering simply basic and premium packages that might also include edgier channels such as Viacom’s MTV and Comedy Central.
Any family package would also need agreements between entertainment companies such as Disney and cable operators.
“Cable probably preferred to take charge of the indecency issue,” said Paul Gallant, an analyst at Stanford Washington Research Group.
By taking the initiative, cable companies can set their own groupings of channels and prices, UBS’ Bourkoff said. If the companies were forced to offer each channel individually, a so-called a la carte method, they would have less control over what customers buy, potentially eroding revenue.
“What makes a la carte damaging is no one knows what the pricing would be,” said Bourkoff, who rates Comcast “buy” and doesn’t follow Time Warner. “Here, costs are relatively defined.”
Time Warner Cable will announce a family-friendly package in the next couple of weeks, said spokesman Keith Cocozza. John Alchin, Comcast’s finance chief, said last week that a similar offering is “under consideration.” Cox may make changes, said spokeswoman Stephanie Davis. Charter also is considering family packages, said Chief Executive Officer Neil Smit.
FCC Chairman Martin and lawmakers have responded to a rising number of viewer complaints that cable channels such as MTV and Comedy Central carry programs that aren’t appropriate for children.
Indecency opponents said the plans don’t go far enough. Cable companies should offer a la carte pricing, said Brent Bozell, president of the nonprofit Parents Television Council, an advocacy group with 1 million members.