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Internet Eats Into Time-Warner Cable Porn Profits 228

Hugh Pickens writes "Big cable companies like Comcast and Time Warner Cable keep saying they don't see Web video cutting into their business, but there's at least one big, dirty exception. Time Warner Cable said in its quarterly earnings report that its video-on-demand (VOD) business dropped significantly in the last quarter. Asked to explain where the drop came from, CEO Glenn Britt came clean, more or less: much of the drop is because, instead of renting a porn video in HD for $9.98, Time Warner's customers are getting their porn fix on the internet for free. 'One of the things going on with VOD is that there's been fairly steady trends over some time period now for adult to go down, largely because there's that kind of material available on the Internet for free,' says Britt. 'And that's pretty high margin.' To be fair, drooping porn rentals don't account for all of Time Warner Cable's VOD decline. Chief Financial Officer Rob Marcus said that while 'the biggest piece of the year-over-year decline was in fact in the adult category,' the rest of the drop is because there weren't many big pay-per-view events like boxing matches last quarter, and because regular movie rentals are down, too."
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Internet Eats Into Time-Warner Cable Porn Profits

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  • Porn niches (Score:5, Interesting)

    by zget ( 2395308 ) on Friday August 05, 2011 @09:32AM (#36996070)
    Having worked with the porn industry, it's mostly because cable companies just show that same old pornstar-looking women with silicons doing the same routine over and over again. People are willing to pay for porn but only if it's a niche they really like. This can be japanese, ladyboys, hairy women, old women, celebs and so on.. Yes, you can find these things freely on tube sites on the internet, but if you like something you want to get more of it and then you go find sites offering content that you cannot find for free. But cable companies will never take that in to their content, because they're afraid people will find it weird.
    • From what I can tell, all kinds of porn is available without paying for it. Whatever the niche you're serving, can't they just google it?


      • Sure. But the question is, do you want to sift through endless amounts of badly done half-assed (no pun intended) attempts at creating a good porn movie or simply drop a few bucks and save your time?

        I'm fairly sure a lot of people would pay a few bucks to get a good porn of their liking damn right now instead of having to browse through $whatever_porn_youtube's stack of $fetish or allegedly-$fetish (because tagged as such but instead just advertising for some completely different kind of porn) movies for mi

        • by jedidiah ( 1196 )

          There has never been in any product area with this sort of certainty. You seem to think you can blindly depend on it, but you can't. You can blissfully blow a lot of money on payware content and still get nothing but crap. Doesn't matter what it is. Films of any sort are the same way. If you pay for something sight unseen, you are likely just throwing your money away.

          Sturgeons Law does not discriminate.

          • That's why they'd have to up their quality level. If you know that on average you get good quality, you're more likely to throw money that way. If you know you get about the same quality level that you could get for free, well, nobody is going to pay for that.

            As long as the creed is "hell, no matter what porn, as long as it's porn they'll be happy", this will of course not work.

          • by Anrego ( 830717 ) *

            Problem with that is you lose repeat business.

            People with niche interests will keep buying more if they like what they are getting. They recommend it to their friends with the same niche interest. If you are serving a small market, this is all important stuff.

          • by geekoid ( 135745 )

            I fail to see how Sturgeons Law applies.
            'Nothing is certain' is different then 'you are likely just throwing money way'.

        • Have you ever tried Cheggit.net ? It's pretty good, or so I hear from my deviant friends :-).
          I think people actually prefer not paying for porn to avoid the paper trail. It's silly but it's still stigmatized.

          • The last time I paid for pr0n, (needed supplementary materials for my brother's bachelor party,) I made the mistake of paying with a credit card. Within a week, I was receiving rather graphic advertisements in the mail from all manner of adult material suppliers. Apparently I had been classified as "a live one," and every money-grubbing distributor was out to get a cut of the action. It actually felt a bit desperate, honestly, as there were many teaser introductory offers just to get me on the hook. Bei
        • by geekoid ( 135745 )

          Or do you want to find a reliable sight you can return to that has everything, for free.

          Your complaint is more like "Paying for porn is for people who can't think of search terms."

    • Or to put it another way: Internet rule #34 beats "family values" cable porn.

      • Pretty much this. In your area anal sex ain't allowed but you want to see it? Or oral? The internet certainly has a big selection, from M/M, F/M or ... whatever/whatever. Your TV won't give it to you, the internet will. In your area S&M sex is considered "indecent"? The internet certainly has it. Your country considered people shagging in shaggy costumes 'animal porn' and hence disallows it? No fear, dear Furries, the internet is your friend.

        Face it, aside of some few fetishes that are illegal pretty mu

    • I'm surprised people still pay for porn.

      No seriously, have any Gen-Y'ers out there ever paid for porn in their life?

      • I'm older than Gen-Y but as someone who follows the "vote with your wallet" philosophy I pay for a good amount of it. I used to buy it mainly because it was hard to get high quality porn on dial-up, now I buy it because there are certain companies whose videos my wife and I enjoy and we want to support them.

      • I'm thinking that the long-term strategy of the porn industry is to make you pay if you want to not see porn. Start Googling something random and adjust the search terms until the first time porn pops up. It usually takes less than a minute, *especially* on image search. Who better than the porn industry to identify what *is* porn, in order to filter it out.

        Only $1.50 for a cock-free day!
        • Google is missing out on a whole untapped market with its "safe search" nannying.

          I bet there's loads of people who'd pay for an *unsafe* search option.

      • No, my grandpa owned a store where he sold porn. Surprisingly some of it got stolen, even though he guarded it well. No idea how those sneaky thieves got behind the counter and took it from there, but then, maybe I just wasn't as wary as he was, it usually happened when he put me in charge. I'm really, really sorry...

    • And yet they find the sale of highly artificial and homogenised H. sap mating scenarios perfectly normal. Weird.
    • by morari ( 1080535 )


      Yes, please!

  • I'd have expected this to be news 5-10 years ago. I'd say if they're only taking a hit from the Internet now, they should consider themselves lucky!
    • Well, their old customers die off slowly while the new generation of porn wankers knows that they needn't buy a trenchcoat to get their porn unseen.

    • by Dunbal ( 464142 ) *
      I call BS. Porn isn't suddenly "free". It's been that way ever since the internet took off. Today's declining sales have nothing to do with it, that's just an incorrect after-the-fact attempt at justification by a junior employee.
      • by geekoid ( 135745 )

        It's mainstream and larger audience is just getting to the point where they are turning to internet porn in large numbers.

        Now think about the age demographics. that 13 years old that was get free porn in 1999 is not in the age demographic Time Warner needs.

    • by foobsr ( 693224 )

      I'd have expected this to be news 5-10 years ago. ... dropped significantly in the last quarter

      Consider this:

      It is big companies, it takes time to wake up.

      It never droppped 'significantly' in a quarter before, and it is hard to get the big picture.


  • the real reasons (Score:5, Insightful)

    by alphatel ( 1450715 ) * on Friday August 05, 2011 @09:43AM (#36996152)
    I am a TWC customer and I can tell you several reasons why no one would want VOD
    1. Their VOD isn't even available in HD, even when you pay the extra $80 per month for the full-on HD package.
    2. Everyone in the porn industry knows that free content has crushed DVD sales for the past 3 years. Did TWC just figure it out?
    3. VOD for $10 a pop, or something streaming thousands of movies, shows, etc from Netflix for $10 per month? Hmmm, wtf should I do??
    4. Whoodathunkit... no one wantws to pay $100 in a recession to watch two skinny boxers beat the crap out of each other. It's free at the sports bar down the street and the beer ain't expensive either.
    • WTF are you talking about?

      Every Time warner HD channel has its own HD VOD channel. there is movies on demand, and HD movies on demand, on a seperate channel.

      As for $10 rentals that is only for porn, and before it is out in theaters movie releases.

      Indivual movies are normally $3.99, $4.99 for HD. Same as blockbuster.

      While time warner is a pain their full ON DEMAND service isnt bad at all, with you being able to watch a movie/ tv show within 24 hours of it being released( some stations restrict that)

      • by stdarg ( 456557 )

        before it is out in theaters movie releases.

        being able to watch a movie/ tv show within 24 hours of it being released

        Can you clarify? Are you saying TWC lets you watch movies on demand within 24 hours of the movies being released in theaters? And sometimes before they're in theaters?

        That's really something I would pay for. I canceled Time Warner years ago but maybe it's time to check them out again.

      • by HTH NE1 ( 675604 )

        Assuming of course that you have equipment capable of VOD, using the cable company's boxes and DVRs, and not a TiVo. Perhaps they should consider letting people subscribe to the adult channels for an additional $n a month.

        And if they are offering that now, they're certainly not advertising it. Or at least not in this area.

    • VOD has raised recently to $15/shot. (No pun intended.) Cheaper to actually subscribe somewhere and get HD videos to serve up on the PS3.

    • by jandrese ( 485 )
      $10/movie is absurdly high, especially since you only get to watch it once and when you're competing with a huge amount of free content on the internet. It's no wonder people are abandoning the service in droves.
  • Commodities 101 (Score:4, Interesting)

    by Shoten ( 260439 ) on Friday August 05, 2011 @09:43AM (#36996154)

    "And that's pretty high margin." ...and also, the very definition of something that will eventually lose out to cheaper, lower-margin outlets, unless it maintains some niche specialization. And last I saw, cable companies weren't really "pushing the envelope" on porn.

    (Which I think I'm grateful for...some of the descriptions of what's on kind of blow my mind. One channel used to draw my interest just for reading the descriptions. You could tell that the poor soul who was writing the synopses had kind of given up on life...it was hilarious. A movie had the phrase "frankly, defies explanation" in its summary.)

  • Story Title (Score:4, Funny)

    by nitehawk214 ( 222219 ) on Friday August 05, 2011 @09:43AM (#36996158)

    The juxtaposition of "eats into" and "porn".

  • by Ltap ( 1572175 ) on Friday August 05, 2011 @09:44AM (#36996166) Homepage

    ... there's been fairly steady trends over some time period now for adult to go down ...

    Well, yes.

  • by GungaDan ( 195739 ) on Friday August 05, 2011 @09:46AM (#36996170) Homepage

    Hard to compete with free, but offer content and convenience at an attractive price and people will buy. Admit to ripping them off ("pretty high margin") and they are less likely to do so.

    • by ShavedOrangutan ( 1930630 ) on Friday August 05, 2011 @10:11AM (#36996392)
      I looked through the Comcast adult VOD catalog once and every title was $10 and up! They have got to be joking! How desperate for a porn fix does someone have to be to pay that much?
    • It ain't even the margin, it's the lack of a better offer, that's all.

      You cannot compete on price with free. So I doubt that cutting the margin will change anything. 10 bucks vs. 0 bucks or 2 bucks vs. 0 bucks, the choice doesn't change, does it?

      What they can compete in is quality and convenience. Take the average free porn-tube. I don't know that many, granted, but the ones I do suffer all from the same problem: Advertising. And I'm not talking about the banners left and right, I'm talking about blatantly

    • by geekoid ( 135745 )

      I don't think anythings really more easier then going to 'youporn.com'. Hell, you could go to the bathroom, fire a site up on your smart phone and bust one out in a few minutes.

      Porn on TV? how quaint.

  • by syousef ( 465911 ) on Friday August 05, 2011 @09:47AM (#36996180) Journal

    The problem isn't porn. It's the quality of TV. There has been a steady decline in the quality of television since the 80s. As if 80s TV was great to begin with. Free Internet porn has been around for about a decade, but Sy-Fi (pronounced sy-phi-lus) has only been around for a little while. Watching people in cooking, renovating, buying real-estate, singing and dance competitions eliminate each other off the "reality" tv landscape as they act like selfish twats is getting old just as "talk shows" like Jerry Springer did once the shock factor wore off. Not to mention the stupid reality TV shows that follow around self-proclaim no-talent know-nothing bimbo "stars" like the Krapdashians So you cable execs need to take a bit of responsibility for your own stupidity in creating and buying bad TV instead of trying to blame people who already have their hand on their genitals and are openly admitting it by watching your crappy porn. You know you have trouble when you've managed to alienate even seasoned wankers!

    Anyway who seriously needs or wants HD at $10 a pop to get aroused? Sometimes less detail is better. ASCII porn was popular back in the day and I remember idiotic strip poker on the Apple IIe back in the early 80s. But I guess having an imagination is so yesterday.

    • by Tridus ( 79566 )

      Yeah, it's true. The number of channels has ballooned, but the money for quality content has not. So to fill all the extra space they need a lot of very cheap programming.

      It's even worse in Canada, where we have the government dictating that we get the Canadian version of the channel instead, which is almost always an inferior version with some very low budget crap thrown in to pad the schedule and meet content requirements. The business model of these channels doesn't even depend on getting viewers, it dep

    • by kannibal_klown ( 531544 ) on Friday August 05, 2011 @10:17AM (#36996448)

      The problem isn't porn. It's the quality of TV. There has been a steady decline in the quality of television since the 80s. As if 80s TV was great to begin with

      I don't agree with that., but that's just my personal opinion.

      Sure, TV is still filled with tons of trash. We have more "Reality TV" and the music channels (like MTV) don't do much anymore, we stil have tons of Soap Operas an your basic sitcoms.

      But some TV-shows have evolved, since just about all TV in the 80's were directed at the whole family (youngsters included) while now we the separate out the shows for adults, kids, etc.

      Crime Shows / Mysteries
      Crime shows are darker and grittier with more mature content; less fantasy, more reality. Instead of them walking into a room with a body under a sheet and the main character saying "they went to town on her" now they're allowed to say specifically what happened like "due to vaginal tearing we can tell she was raped" and include some science and forensics in the investigation. IE, talking about something new or interesting in forensics (and thus teach something) instead of Columbo picking up a blonde hair with his bare hands and saying "Aha."

      They also try to be realistic; now-a-days our cop shows try to be very realistic, at least compared to Starsky and Hutch or TJ Hooker.

      Meanwhile the motive also tend to be more varied since they're allowed to cover more sensitive areas. Sure, the motives still revolve around money / love / revenge but due to the "standards" of the 80s they could only say or do so many things. Now it can be "they assaulted my daughter" or "my wife gave me AIDS" or "my husband left me for another man."

      Sure, Jessica from "Murder She Wrote" and Columbo were charismatic and all-around good... but so are characters like Adrian Monk, Elliot Stabler, Shawn Spencer, etc. And most of them demonstrate more personality than some of the old TV characters. Face it, Jessica was nice but was otherwise a plain/vanilla polite older woman.

      Adventure / Heroes / SciFi
      Compare the first season of Heroes with the $6million Man or the Bionic Woman. Special effects aside, there is a LOT more complexity in the newer shows than those old hits. The characters are dealing with more personal demons or concepts, instead of the Bionic Woman having 1 or 2 episodes where she was depressed about not being a real woman anymore.

      The recent Battlestar Galactica wasn't everyone's cup of tea. But go back and watch the original, seriously go and watch a marathon. It was the same 3 or 4 flight sequences shown over and over, it was VERY family oriented and/or directed to 7-year-olds. There was little/no realistic reaction to being the survivors of a holocaust. And the science fiction elements were quite rare. With the remake we got more cerebral discussions on politics, philosophy, and emotion. AND we got more in-depth science fiction descriptions and discussions: AI, FTL, how this widget works, etc.

      Star Trek: granted the original series was the 60s and not the 80s. But in the original we didn't get much explanation for the events going on, just the occasional strange alien that had a weird ability. Did we learn how their FTL work, no just that it required dilithium crystals. The Next Generation / DS9 / Voyager really put the sci-fi elements to shame. We got real-life theories on how stuff might work, some real biology terms, and some fake techno-babble.

      And don't get me started on cartoons. Try watching some 80's era Transformers, GI Joe, Smurfs, etc. Taking off the rose-colored glasses and you'll see they were lame... even for the targetted age-groups. Now watch one of the DCAU cartoons (Justice League, Batman TAS, etc), or Young Justice, or Generator Rex, or heck even the Thundercats or Transformers revivals going on now. More mature, more cerebral, better animation, etc. Sure there's still Sponge Bob and Adventure Time but they try to make things more complex

      • Ahem.. new CN programs like Adventure Time and Regular Show are light years away from Sponge Bob. AT and RS work with little kids but watch them sometime and you'll see a whole lot of elements in there that are directed directly at 25-40 year olds... lots of references to old video games, inside jokes for the parents, etc. They are have more in common with the old Warner Brothers shorts meant for all ages than anything from the 1980s and clearly have jokes that the little ones won't get. There is a lot o

        • by geekoid ( 135745 )

          Do you even watch spongebob? there are tons of jokes clearly aimed at parents.

        • Ahem.. new CN programs like Adventure Time and Regular Show are light years away from Sponge Bob. .

          Don't get me wrong, I watch more Cartoon Network that I care to admit. While I don't watch much Adventure Time or The Regular Show I have seen them and know they are NOT the Snorks / Smurfs / etc. And The Venture Brothers are one of my favorite shows period, just behind Archer (from FX).

          But for argument's sake I wanted to stick with the more action-oriented shows were people actually get hurt and there are deeper plots comparing to similar shows from the 80s (Justice League vs Super Friends / GI Joe Reneg

      • Re: (Score:3, Funny)

        by operagost ( 62405 )

        Face it, Jessica was nice but was otherwise a plain/vanilla polite older woman.

        That's what she WANTED you to think. In reality, she was the most diabolical sociopath to ever live, able to murder dozens of people and not only pin the crime on others but usually get them to CONFESS to it! How else can you explain a writer "stumbling" into so many murders?

      • by Lumpy ( 12016 )

        "less fantasy, more reality."

        have you WATCHED CSI? It's 98% fantasy and 2% made up crap. 0% reality.

        • "less fantasy, more reality."

          have you WATCHED CSI? It's 98% fantasy and 2% made up crap. 0% reality.

          True, CSI and those insane User Interfaces on their PCs are scifi... sorry but the Fingerprint Matching app is not 2 steps away from the interface on "Minority Report." The fact that they have DNA tests coming back within hours or 1-2 days is bonkers. And CSI Miami is more action-oriented than crime drama.

          But they do include more forensics and pathology in the show than back-in-the-day. Like I said, back in the day you were limited to finding a blonde hair with your bare hands, not seeing much with the b

      • The recent Battlestar Galactica wasn't everyone's cup of tea. But go back and watch the original, seriously go and watch a marathon

        I just did. BSG (the new one), Caprica and BSG (the original) plus BSG 1980 (the time travel one).

        BSG (the new one, way too soapy for my liking, 'soap in space' pretty much sums it up for me but enough of that)

        BSG (the original one) I SWEAR that the original script was written in a language other than English and they used a primitive version of Google translate to render it into English.

    • There has been a steady decline in the quality of television since the 80s. As if 80s TV was great to begin with.

      TV was called a "vast wasteland" in 1961. It's always been terrible.
      http://en.wikipedia.org/wiki/Wasteland_Speech [wikipedia.org]

      Click that link; it's a good, quick couple paragraphs to read.

    • Well, there is hope. TLC finally gave Kate Gosselin the boot [yidio.com]! Unfortunately, she was replaced by Big Hair Alaska, a new reality show about Sarah Palin's hairdresser in Wasilla. Yikes!
    • by Lumpy ( 12016 )

      Go down to your local dildo shop and BUY most porn DVD's for $9.99 still sealed and free of bodily fluids. What idiot does PPV Porn? OH I know who... the Teenager at home when mom and dad go out of town and dad is a moron and never looks at the cable bill.

      • by geekoid ( 135745 )

        Or a teenager decided to gets a spoofed card fr the cable box and no one know what he did.

        In the 70s, I built a circuit so I could descramble the porn.

    • by geekoid ( 135745 )

      ". There has been a steady decline in the quality of television since the 80s."
      Wrong. There are fasr more good, if not grate' things on TV then in the 80s.

      Reality shows or only a tiny slice of what most people have access to.

      Here is a small list of thing I consider substantially better then anything in then 80s:
      Family Guy
      American Dad
      IT crowd
      Burn Notice
      White Collar
      Dr. Who
      Top Gear
      Colbert Report
      Daily Show
      Bones(although the latest season sucks)
      And I could go on.

      I you sure you're not just being nost

  • by zerofoo ( 262795 ) on Friday August 05, 2011 @09:47AM (#36996186)

    As pay-for-tv companies start to see their video revenues decline, be ready for the severe data caps that will follow.

    Cable and Telcos will fight to the death to keep from becoming dumb pipe providers, and thanks to our lack of net neutrality laws, or any sort of real competition in data services, they might succeed.


    • by Ichijo ( 607641 )

      Data caps are only needed for prime Internet usage hours to keep the data pipe from getting congested. Broadband ISPs really ought to embrace the "unlimited nights and weekends" model used by the cell phone companies, although in this case it might be 10pm-6am.

      With some kind of congestion management like this in place, ISPs can sell more bandwidth using the same infrastructure and offer lower priced data plans, and customers can further economize by scheduling their movie downloads for the wee hours.

    • I reckon they'll start lobbying to make free web porn illegal. Probably by requiring a credit card be involved to "protect the children." Anything that causes ISPs or the *AA to make less money than they'd prefer is criminal, after all.

  • ... I can tell you there is a lot of porn available for VOD. Often when I use the directory to search for shows by names, I end up with results porn results coming back when I am typing in the name of the show I am looking for.

    I will say from reading the descriptions that they do a fairly good job of covering the various generic fetishes, too. Any ethnicity you can imagine wanting to watch do whatever you might want, it's there...

    Although I can't imagine wanting to pay my cable company to watch that, even considering the fact that the cable bill comes out of my checking account automatically without a printed bill ever mailed to my house...
  • Seriously, every single person I know who subscribes to their services does so either because they have no other choice or because they were told by the landlord when they moved in that they had no other choice. Not a single one of them would keep the service if they had any other choice for cable.

    While its an interesting theory that it is the internet that is causing the decline in Time Warner's revenue, and it is true that I know people who finally have gotten so fed up with them that they have decided t

    • by Lumpy ( 12016 )

      The FCC states that the landlord can suck it in his bunghole. People really need to become more educated.

      The Federal Communications Commission (FCC) has created laws that protect a tenant's right to buy satellite dish service. The FCC regulations prevent landlords from making rules that unfairly restrict a tenant's ability to install a dish on rental property. This page attempts to explain the FCC's laws. It is not clear, however, how the laws will apply in many cases.

      Before any of the following rules can

  • Warner Bro's cable having to publicly discuss their lack of profits on porn assets when their monopoly is primarily in areas where people have swallowed the religiosity pill. They are so fucked.

  • People like me who, 2.5 years ago, said FU big cable companies and pulled the plug completely. There is plenty to see in full bandwidth HD over the airwaves (as opposed to compressed to hell and back before the cable company send it down my wire). All I miss is ESPN. TNT would be nice during the NBA playoffs. All in all I save $100/month (at least) and still see most NFL games I want.

    ESPN should set up local OTA affiliates, I'd pay $10/month. Besides that I won't pay for any television.

    • ESPN is Disney, and ESPN is the stick they use to get cable operators to carry a whole bunch of Disney channels with lower viewership at fairly high prices. You won't be seeing ESPN OTA affiliates ever.

    • by Lumpy ( 12016 )

      Change your sports tastes. I stopped watching Baseball and started watching Soccer. I get an AMAZING amount of all I can eat free HD soccer and Rugby from FTA satellite that is brain dead easy to install. Costs nothing but the $199 receiver and the $99.00 dish and pointer and a weekend to install it.

      https://secure.wikimedia.org/wikipedia/en/wiki/Free-to-air [wikimedia.org]

      http://www.gosatellite.com/ [gosatellite.com] is where I shop... as well as ...
      http://www.sadoun.com/ [sadoun.com]

      Works great, and is wife friendly as well. Plus if you are not a

  • All my porn (Score:3, Funny)

    by Chuby007 ( 1961870 ) on Friday August 05, 2011 @10:38AM (#36996678)
    All my porn consists of a 5 minute video, that I play over and over again... no need for more than that, it gets the JOB done..
  • $10 for renting a single video? I think thats the problem. I could buy video for $10-15, but rent for $1-2. Those prices are unreasonable.

  • 'One of the things going on with VOD is that there's been fairly steady trends over some time period now for adult to go down..." Giggity -

    http://www.youtube.com/watch?v=ZDPrpzbIUgg&feature=related [youtube.com]

I just asked myself... what would John DeLorean do? -- Raoul Duke