Local TV

Kagan: Retrans to Top $6 Billion by 2018

Says increased projection is due to stations getting more money for their signals 11/05/2012 11:33:02 AM Eastern

SNL Kagan is projecting retransmission consent fees to surpass
$6 billion by 2018 (the prediction is $6.05 billion), almost triple the
projection of $2.36 billion for 2012, and on pace for a little south of $1 per
sub.

In November 2011, Kagan projected $4.86 billion by 2017.

Kagan said that the increased projection was due to
"the success of a wider range of TV station owners in securing
sequentially higher retrans fees from multichannel operators over the last year
of negotiated deals." Or put another way, more stations getting more money
for their signals.

But according to Kagan, that is still only 10% of the
estimated $43 billion by 2015 that cable operators are projected to pay cable
programmers in affiliate fees.

At the estimate of just under a dollar per sub, Kagan
predicts that by 2018, subs will be paying about $4.86 per month to cover the
aggregate retrans fees in the market.

Kagan is predicting that multichannel providers will be
paying $3.49 per month for the five primary broadcast networks by 2015,
compared to $6.37 they are projected to have to pay for ESPN.

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