Stations Ponder Life Under Retrans Blanket

Affiliates eye landmark NBC ‘proxy’ arrangement—both hopefully and warily—and wonder what it means for them

The sharing of retransmission consent
cash was a hot topic at the affiliate meetings during
upfront week, and continues to stay top of mind
as stations’ affiliation agreements come due. NBC’s blockbuster
announcement about working out the framework
for the network to negotiate retrans
on behalf of affiliates compelled station
chiefs tied to all the networks
to wonder if such an arrangement
might work for them. Deals of that
nature were discussed when the
CBS affiliates met in New York last
month and remain, at least for now,
on the table. “At this point, it’s just
at the discussion stage,” says Scott
Blumenthal, past chair of the CBS
affiliates board. (Current CBS affiliates chairman Wayne Daugherty
did not return calls for comment.)

Getting broadcasters on either
side to talk about retrans is akin to
getting them to spill their deepest
and darkest secrets. But many laud
NBC for working on what’s seen as an equitable and stationfriendly
retrans arrangement. And while Fox was blasted for
its very public dealings with its affiliates board over reverse
comp demands, several CBS affiliates say their network is
every bit as hardcore in the boardroom. “CBS is doing the
exact same thing as Fox,” says one station group leader who
asked not to be named. “They’ve just been quieter about it.”

CBS clearly is bold on retrans. On an earnings call in
early May, President/CEO Leslie Moonves said he is “very
confident” CBS will book $250 million in retrans (not including
affiliate fees) in 2012. When CFO Joseph Ianniello
broke down retrans numbers based on getting 25 cents per
subscriber, Moonves added that 25 cents was “a little low.”

More recently, Ianniello spoke of getting 50 cents a sub
from CBS’ owned stations, and 25 cents per from affiliates.

NBC affiliates board chairman Brian Lawlor says NBC’s
proxy model should be in place this
summer. But several station insiders
are skeptical that the deal will
come to light. “[NBCU CEO] Steve
Burke and I would not have introduced
it if we didn’t have high confidence that it would be possible to
advance,” counters Lawlor.

Affiliates of all stripes are curious
how such an arrangement might fit
them. A key figure on the Fox affiliates side called it “a compelling
deal.” Multiple CBS affiliates said
the network did not seem receptive
when the concept was brought up
in New York. “I applaud NBC for
taking that tack,” says Kirk Black,
CBS affiliates board vice chairman.
“I don’t think CBS is as interested in doing it that way.”

CBS declined to comment on blanket deals, but noted
that it had quietly done a number of retrans agreements.

CBS affiliates love their thriving primetime, and are
encouraged by new management—and new strategy—at
CBS News. The bosses at Black Rock, and at CBS stations
around the country, hope they can find common ground
on the increasingly fractious topic of retrans. “Obviously it’s
an issue every station, regardless of affiliation, has to deal
with,” says Black. “If you look at the pattern of CBS and its
affiliates, we shut the door and try to get things done.”

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