Time Warner Tests Cheaper Cable

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Time Warner will offer a lower-cost cable package in test markets, the company announced Monday. 

“TV Essentials” costs just more than half the price of Time Warner’s current standard cable service (which varies by location). It’s designed to help those struggling in tough economic times, explained Glenn Britt, the president, CEO and chairman of Time Warner Cable. The slimmed-down channel lineup will cost $39.99 per month in New York City, where tests are already underway, and $29.95 per month in Northeast Ohio, which will get the option in December. 

Of course, Time Warner’s latest offering comes with decidedly fewer channels than the standard package. Included are basic local channels from ABC, CBS, Fox, NBC and PBS, as well as 41 other cable channels including Bravo, CNN, Discovery, Disney, FX, Nickelodeon, TBS, USA and VH1.

Absent from the package are ESPN, Fox News, MSNBC, TNT and the Food Network, as well as any and all high-definition channels. Customers will still have access to new movies through Time Warner’s On Demand service, at standard rates of $4.99 per movie.

According to Time Warner, the package is valued at $49.99, but will be offered at the lower rate for a promotional 12-month period. Its full-price packages typically cost between $50 and $75, depending on location. Further launches are planned in 2011.

Additionally, the lower-cost package will not be eligible for the discounts that Time Warner Cable offers to customers who sign up for television, Internet and phone service together.

“This video-only package isn’t for everyone, but we hope that some of those most hard-hit by the current economic conditions find it to be a helpful option,” Britt said.

The cheaper package is being offered at a time when cable companies themselves are struggling. A November survey from market-research firm SNL Kagan indicated that amount of cable subscribers decreased dramatically in the third quarter of 2010 and cable providers have continually ranked low on the University of Michigan’s American Consumer Satisfaction Index.

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