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CBS Raises the Retrans Bar

Retransmission consent and reverse compensation revenue could double over the next five years to $1 billion at CBS, chief financial officer Joe Ianiello told an industry conference Tuesday.

CBS has said in the past that it expects to reap $250 million in retransmission consent revenue from its owned and operated stations and another $225 million in so-called reverse compensation from its affiliates. At the Barclays' Communications, Technology & Media Conference in New York, Ianiello said that is based on receiving 50 cents per subscriber per month for its O&Os and another 25 cents per subscriber per month from its affiliate stations.

"That's $475 million of revenue and profit, because there is no cost against it," Ianiello said of the current retrans and reverse compensation haul. "My simple math was it should be $1; just double everything. That's the $1 billion. Whether that happens in three years or five years, we can debate about the time frame, but nobody is debating that it's there. We know every contract when it expires and what we need to get in those negotiations. The track has been laid. The good news is that from where we sit today, there is significant upside that is significantly accretive to our margin."