CEO Glenn Britt sees Time Warner Cable's future and it isn't the set top box. Growth in broadband and over the top competition appears to have TWC finally embracing the internet. "Combined with the idea that they could some day raise prices on those who use the most data, the company painted a picture of a business that would survive the transition from traditional cable video to the Internet. 'High-speed data is quickly becoming the anchor product in the eyes of our customers,' Chief Executive Glenn Britt told analysts Thursday." This awareness certainly is based on the trends of the business although it should have been acknowledged much earlier. While their broadband subscriptions rise, even greater than forecast, video subscriptions continue to drop each quarter.
That broadband data, whether e mail or video content, is what is driving the cable business. It is also what is pushing TWC and other cable operators to push their channel line-up out on the web to PCs and tablets. But to embrace IP is to move away from EBIF and set top boxes. "The company's engineers are focused on delivering more video over the Internet to an array of devices include Apple Inc.'s iPad, developing technology that could eventually make cable set-top boxes unnecessary, Britt said." And necessary for a TV Everywhere experience.
This announcement might also be a blow to set top makers like Motorolla and Cisco (Scientific Atlantic), as well as companies building EBIF tools for the set top - Canoe Ventures, Ensequence, and others. TWC is a partner of Canoe and Britt's remarks about the obsolescence of the set top seriously undermines these companies' business models. It is the web and cloud computing that is the future of TV - network DVRs, interactivity, mobile content, and not a set top box in sight.
For Time Warner Cable, the numbers aren't lying. The challenge is how fast TWC and other cable operators can turn their ships to take more advantage of the web before other over the top competitors take too many subscribers away.