Time Warner's Turner Expects to Follow HBO With Streaming Service
Everyone's going mobile, it's just a matter of when.
David Levy, president of Time Warner's (TWX) Turner Broadcasting, owner of TBS and TNT, said he'd expect that within five years, his networks will be available through a streaming service similar to Netflix (NFLX) - Get Report and his sister company, HBO.
"We have to have consumer-facing products," said Levy, during an interview Friday at the Paley Center for Media in New York. "We're not in the television business. We're in the content creation distribution data business. We're not in the television business."
Were Turner to launch a streaming service it would follow HBO NOW, which launched earlier this year, as well as CBS (CBS) - Get Report , which started a facsimile of its network in the spring, minus the NFL, called CBS All-Access, in addition to an online version of Showtime. Streaming services that don't require a pay-TV contract and skinny bundles such as Dish Network's (DISH) - Get Report SlingTV have gained popularity as media companies look to connect with viewers frustrated by the cost and unwieldy nature of the 150-plus channel bundle.
James Murdoch, CEO of 21st Century Fox (FOXA) - Get Report , among other media executives, has been outspoken in his criticism of cable-TV and satellite providers for failing to offer a mobile platform that appeals to customers, especially younger people.
Millennials, Levy said, are subscribing less and less to pay-TV packages, a product of both price and a failure by cable-TV and satellite services to market their product.
"Cable has done a poor job marketing how good $80 is, what you get for that $80," Levy said. "So, we as a company have to find ways to find new revenue streams, whether in new pockets, sports, over-the-top, direct to consumer." Over-the-top refers to streaming services that initially ran through devices such as Apple's (AAPL) - Get Report AppleTV or Roku, but are common on so-called smart-TVs.
Turner, which owns rights contracts with Major League Baseball and the National Basketball Association, has been live streaming sporting events such as the NCAA basketball tournament in addition to music concerts such as an awards show hosted by Live Nation (LYV) - Get Report .
Over the summer, Turner took a majority stake in the online video provider iStreamPlanet for nearly $200 million, according to The Wall Street Journal, part of its efforts to offer more programmings, primarily sports and music, that can draw the large audiences that major marketers covet.
But as mobile streaming through apps or the mobile Web becomes increasingly commonplace, Turner, which also owns Cartoon Network and TruTV, will look for a means to deliver its programming directly to consumers, Levy said.
As for how to pay for mobile, Levy acknowledged that the costs continue to outweigh the revenue. But as mobile becomes the preferred means of consuming media, companies such as Turner has no choice but to invest in products such as live streaming.
"We've got to figure out the monetization strategy for mobile," he said. "But I think that comes later. For now we have to continue to push the products out."