If Time Warner is concerned about cable and VOD sales, one can only imagine the impact on the DVD sales.

Cable companies are getting worried that more people are watching TV over the Internet. Glenn Britt, chief executive of Time Warner Cable, voiced his concern in February during a quarterly earnings discussion with analysts.

"We are starting to see the beginning of cord cutting," he said. "People will choose not to buy subscription video if they can get the same stuff for free."