Tomahawk, WI 8/05/2013 (Basicsmedia) – Time Warner Cable Inc (NYSE:TWC) is known for the provision of services relating to  voice services, high speed data and video in the U.S. it’s systems are located in Ohio, New York State, Texas, South Carolina and North Carolina, as well as Southern California. The company serves more than 15 million people in the U.S alone, and it has a loyal base of clients who continue subscribing to two or more of its services. This is quite impressive for a company of its stature since this simple measure assures it of continued revenue, thus presenting TWC as a good investment option for anyone interested in it.

What Problem is TWC facing Currently?

Currently, TWC is embroiled in a row with CBS where each company is blacking out the other one from its cable services. This is the one major piece of news regarding TWC and it is not something which should cause any worries to investors. It is something which has no capacity of messing up with the company’s financials in a major way thus leading to losses and a drop in the stock price for any length of time. In the short term, there could be a few things here and there which don’t augur well for the company’s performances financially.

How Will This Row Affect TWC?

It’s a fact that close to three million people may be affected by the row, and this may not be good news for its investors. If the row is allowed to continue for a much longer period of time before any solution is sought or arrived at, then the three million subscribers who stand to be affected may have no option than to look elsewhere. This may affect TWC’s margins and revenue. Therefore, in order to forestall such a scenario from arising, it is a good idea to look for amicable ways of resolving any problem between the two companies and finding a way out of this situation, which doesn’t seem easy at the moment.

10twc

This diagram shows the growth which is expected in the

Pay TV Sector for the next five years. It is courtesy of www.digitaltvnews.net

However, it is important to note that the current situation is just a tip of the iceberg highlighting something which has been going on for quite some time. It has been reported that there is growing tension between TV channels and companies which act as distributors of Pay TV. The tension has to do with the fact that they are being asked to pay more in fees by the leading and some of the well known broadcast networks. Broadcast networks, of which TWC is one, say that they need those fees which can bring in revenue of not less than $1 billion in some cases. They can’t afford to operate without these fees.

What Does All This Mean to Investors?

First, investors need to pay close attention to how any row between players in this industry is resolved. Any row which is allowed to go on for much longer than is necessary, may lead to loss in the long term. This industry has to put up with numerous rows from time to time, and some of them have no bearing at all in the general financial health and performance of the company. With that said, it is important to find ways of resolving these problems before they start being considered a nuisance and investors get jittery about everything. Meanwhile, I would say TWC is a good investment option, if you don’t mind the rows.

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