Time Warner cable will be dropping the Ovation channel on December 31st, possibly the first of many networks to go in the year ahead. Low ratings are being cited by TWC management, as CEO Glenn Britt recently promised to take a hard look at channels that cost money but don’t bring in viewers.
Ovation, a network that has a household penetration of around 51 million, is the only channel focused on the arts. The network quickly noted that Time Warner cable carries dozens of sports channels, and set up an online petition site for affected customers. Located at keepovation.com, a boilerplate statement is followed by an area where viewers can sound off on the decision by Time Warner.
If the channel is removed, Ovation would stand to lose more than 7 million households. A reduction in household subscribers will quickly reduce revenue from advertisers buying commercial time on Ovation. A downward cycle like this will put a network out of business in a hurry.
Time Warner makes a strong argument, claiming they have paid $10 million in carriage fees over the past few years – but less than 1% of its customers watch the channel on any given day. With such a small audience, its hard to imagine much of an outcry will come from Time Warner subscribers.
Ovation faces an uphill battle, as it stands alone in negotiations. Other media conglomerates like Viacom offer multiple channels to distributors, usually in an all-or-nothing contract. This leads to nasty disputes from time to time, like the Viacom-DIRECTV battle earlier this year. During that dispute, millions of customers lost popular channels like MTV and Nickelodeon for two weeks.
While Ovation won’t send millions heading for the exits, a few customers may jump ship to other providers. Ovation is currently on DIRECTV channel 274 and DISH Network channel 291. Other providers carrying the network include Verizon FiOS and AT&T U-verse.