Time Warner Cable’s ‘Starter TV with HBO’ not enough to draw cord nevers

The pay-TV industry has been slow to acknowledge that it’s having trouble keeping subscribers – most simply blame the economy for the losses – despite continuing erosion that eventually could resemble the Grand Canyon.

The fact that it has a tough time attracting younger viewers, the so-called “cord nevers” to its product, on the other hand, has been easier to admit.

So, it should come as no surprise that Time Warner Cable, which has been harder hit by subscriber losses than most of the other players in the segment, finally has launched a product aimed at that group, looking to draw some of them into its fold.

TWC is offering a $29.99 “Starter TV with HBO” bundle that it hopes will attract consumers who have never had cable before.

But the bundle is pretty thin. Aside from HBO and a handful of local channels, the rest of the offering doesn’t seem to be the stuff of a Twenty-something’s video dreams: three shopping channels and three C-SPAN channels.

The new bundle is a step up from TWC’s cheapest package, “Starter TV,” which doesn’t include HBO.

The deal is being offered for a 12-month term, which indicates TWC, the nation’s second-largest cable operator, is hoping to eventually upgrade new subscribes to some of its pricier tiers (the Standard TV package is the next one up the ladder, and it counts 20 channels – but no HBO).

IHS Research forecasts that 2013 will be the first year ever that the number of pay-TV subscribers declines, from 100.9 million to 100.8 million users. Rich Greenfield, an industry analyst at BTIG, told Bloomberg that there’s growing concern it’s a trend that will continue, too.

“It’s hard not to be concerned,” he said. “Alternatives are growing by the day.”

Offering cord nevers a “cable lite” program really isn’t likely to be much of – or enough of – an incentive to lure younger users to a product they’ve easily marginalized in its present form.

Want to reach cord nevers? Offer a hybrid package of traditional broadcast channels with a rich bouquet of over-the-top content.

That approach allows operators to pitch niche content along with premium content that can truly broaden their reach to consumer segments disinclined – whether because of price, convenience, or preference – to commit to pay-TV services; and it can be add revenue streams without cannibalizing traditional subscriber revenues.

Stay tuned.

Jim O’Neill is Editor of Videomind and Principal Analyst at Brightcove. You can follow him on Twitter @JimONeillMedia and on LinkedIn