Time Warner Considers Freeing HBO Outside the Cable-Box

NEW YORK (TheStreet) -- Five years after splitting off Time Warner Cable  (TWC) , Time Warner  (TWX) CEO Jeff Bewkes is considering allowing HBO, the media company's popular premium network, to also cut the cable-TV cord.

HBO could eventually be available as an individual service accessible without a cable subscription, Bewkes told investors at Goldman Sachs' Communacopia Conference on Wednesday. Bewkes was guarded about a timeline but the fact that Time Warner is edging closer to a direct-to-consumer model for its prized HBO franchise stands to accelerate the decline pay-TV and put some heat on the current undisputed over-the-top broadcast leader, Netflix (NFLX) . 

At present, Time Warner is experimenting with HBO as an "add-on" to slimmed-down cable packages, an effort that pay-TV operators such as Time Warner Cable have embraced in hopes of stemming the overall decline in subscribers. The channel known for shows such as Game of Thrones, Boardwalk Empire and Deadwood was previously lumped in with premium, full-service subscription packages which gave consumers the full-range of premium content channels for a top-tier price. 

Pundits have been heralding cable's doom for the past two years as streaming video-on-demand services led by Netflix and Amazon AMZN  poached cable-TV subscribers with its inexpensive rates and "TV Everywhere" mantra. The U.S. cable industry has suffered through a loss of subscribers averaging 480,000 per quarter over the past two years, according to IHS statistics.

Though distribution through pay-TV remains profitable for HBO, Bewkes' comments make clear that Time Warner has no intention of slowing down its development of the HBO GO app as a hub for broadband access to all of the series, movies and sporting events produced at Time Warner. 

Until now, the best opportunity has been to focus on penetration, Bewkes said, though the "broadband opportunity is getting bigger ... becoming more viable and more interesting."

"We could do it if we wanted to do it now [but] we don't want to do anything if we couldn't do it in a very high quality," he said. If it was to explore the demand-only model, the New York-based company would not rush a product to market to capitalize quickly at the expense of user experience. Bewkes noted it would first need to develop a good tech platform, considerable customer support and strong partnerships with broadband providers.

Bewkes noted the move is still being considered and that the company has nothing to announce yet. 

-- Written by Keris Alison Lahiff in New York.

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