Belo, ABC Retrans Negotiations Heat Up

Shive says networks want their cut of cash

By Michael Malone -- Broadcasting & Cable, 11/4/2009 12:31:44 PM

Belo forecasted $41 million in retransmission consent revenue for 2009, but President/CEO Dunia Shive says ABC wants a taste of the cash. Addressing investors on an earnings call Nov. 3, Shive says the networks are asking for "reverse payment" from their affiliates.
"I don't think there is any secret that the networks look for some sort of a reverse payment from the affiliate and as for ABC, well I can't get into specific because we're in the middle of negotiations," she said. "I do expect to reach an agreement with ABC to renew our affiliation agreement and I expect the ultimate terms that we agree to, financial or otherwise, to be manageable for the company."
Belo owns four ABC affiliates, including KVUE Austin and WFAA Dallas. Belo's retransmission consent revenue for the third quarter was $10.6 million, and 7.5% of the broadcaster's total revenue for the quarter. Belo said its gains in retrans were due to contractual "growth rates included in existing agreements, the full year effect of negotiations completed in the past year, and continued growth in subscribers across cable, satellite and telco distribution systems."
Shive says it looks like ABC wants affiliates to share programming costs. She said Belo's responsibility on that front will come out of the negotiations. "I think it is fair to say that they're not, at least from my perspective, coming and saying 100% of the retrans comes the other way," said Shive, who declined to offer specifics.
ABC did not comment, claiming that the negotiations are private.
Whatever payment Belo were to make to the networks, Shive said, would be categorized as a programming expense.