NBCUniversal boss Steve Burke runs a giant TV business. But his kids are working against him, because none of them are paying for TV.
“I have five millennial children between the ages of 19 and 28, and none of them subscribe to cable or satellite,” Burke said yesterday at a Bank of America conference.
This is the kind of thing some people say when they want to argue that the TV business is screwed, and the kind of thing cable bear Rich Greenfield loves to call out on Twitter.
But Burke isn’t the kind of guy who says TV is screwed at an investor conference. Instead, he spent the bulk of the interview arguing that the TV business is a great business, and that NBCUniversal is trying to make it even better by making different digital bets on the future.
(Here we need to point out that Vox Media, which owns this site, is one of those bets: Burke put $200 million into Vox last year.)
Burke was arguing that he wasn’t optimistic about “skinny bundles” — cheaper pay-TV packages with a limited set of channels — that NBCUniversal rivals like Time Warner are embracing. But he said he’s happy to sell his stuff into those bundles, too, whether they’re sold by traditional pay TV guys or digital services like Sling or Hulu.
Here’s the full quote:
The fact is, if you want a decent-sized bouquet or bundle of cable channels, your programming costs are going to be $40, $50, $60. And if your programming costs are $40, $50, $60, you are going to have a consumer proposition that's going to be $40, $50, $60 or more.
And if you are a consumer that has cable and you get 200 channels, I'm not sure why huge numbers of people are going to run out and get excited about paying $45 for 25 channels. It just doesn't — from a consumer point of view, it doesn't seem to make sense to me.
I have five millennial children between the ages of 19 and 28 and none of them subscribe to cable or satellite. They're not going to pay $45 for 25 channels, and it's hard for me to figure out how that becomes a big business based on that kind of a structure.
That having been said, our job at NBCUniversal is to license our products and maximize the cash flow of our individual channels. And if people are interested in putting together OTT businesses like Sling or the Hulu product or Sony or others, we're going to sell to those suppliers.
This article originally appeared on Recode.net.