Time Warner CEO: $100K for 1st-run TV rights a 'measly little offer'
Time Warner CEO Jeff Bewkes said Monday that Netflix does not have the financial muscle to compete with existing models of distribution for TV shows and movies.“Large aggregation at a low price is not particularly useful to consumers or for content creation,” said Bewkes during a keynote session at the annual UBS media conference in New York. Responding to a report last week that Netflix would be willing to pay $100,000 per episode for new TV shows airing this fall, Bewkes charactetized it “a measly little offer” compared to the hundreds of millions of dollars paid for shows through first, second and third cycles of syndication and for DVDs. What makes sense for Netflix, Bewkes added, were shows and movies that can no longer be “monetized” through existing channels. For Netflix to be competitive, it would have to buy up the full suite of rights for TV shows, not just the “sliver” for streaming rights. On HBO and Cinemax losing 1.5 million subscribers recently, Bewkes said: “Don’t worry about HBO.” He said the drop in subs was not due to cord-cutting, people ditching cable subscriptions, but was the result of nuances with how distributors market HBO packages. He did say he could see a day when HBO could be offered outside the cable bundle. HBO recently launched HBO Go, a broadband streaming service that requires users to prove that they subscribe to the premium service. Bewkes defended his conservative approach to mergers, but denied that he was “close-minded” about deals. He did say most deals are not successful, cost too much and that so-called synergies are often over-stated. That said, Bewkes added that Time Warner has spent a billion dollars or so in the past year on TV network and production deals, largely overseas. In terms of scouting targets, Bewkes said “we’re still out there and interested.”