Les Is More Vocal on CBS's Retrans Talks

CBS CEO Les Moonves stepped up the retransmission-consent rhetoric last week, announcing at an industry conference that the broadcaster is currently in negotiations with some major distributors concerning retransmission consent deals that are set to expire within the next two years.

“We have begun our conversations with some of the bigger guys that are up this year, including Cablevision [Systems] and EchoStar [Dish Network],” Moonves said at the Merrill Lynch 2008 Media Fall Preview conference in Marina Del Rey, Calif., last Tuesday. “They are at a very good point. We're talking about bigger global deals that involve CBS and Showtime and College Sports and all sorts of other things. We expect to get paid for our content. We think retrans will kick in significantly in 2009. There will be absolute revenue that drops to the bottom line.”

Moonves has been a vocal proponent of cash for retrans, with some speculating that he could ask for as much as 50 cents per subscriber per month from cable, satellite and telco TV operators.

Asked if CBS will ask for 50 cents per subscriber per month or a lower figure, like 25 cents per month, Moonves replied, “The first one is a good starting point. We'll leave it there for now. We'll see how that all goes in terms of negotiations. But, that's where we've been with the other deals.”

CBS has retrans deals with about 25 other small distributors.

Moonves said CBS's deals with Cablevision and DirecTV expire in 2008, while its deals with Comcast and Time Warner Cable fall off in 2009 and 2010, respectively.

“The big guys are coming up and we anticipate that everybody acknowledges that we should get paid something,” Moonves said. “It's a new universe and unlike the other networks, we're not part of a big cable distribution system where you can hide what you do through one of your cable assets.”

CBS isn't the only television station operator pushing for retrans cash — others, like Sinclair Broadcasting Group and Nexstar Broadcasting, have had several public battles with cable operators over the years — but it is one of the biggest. CBS owns and operates 29 stations — 14 affiliated with the CBS network and 15 affiliated with the CW Network, MyNetwork TV or operating as independents — in such large metro areas as Chicago, Boston, San Francisco, Dallas, Atlanta, Detroit and Seattle.

CBS has been under pressure as its stock price has dipped about 40% so far this year as the advertising market has come under pressure. At the conference, Moonves predicted that the ad market would rebound in the next two years, adding that “network television is the only game in town if you want to aggregate a large audience.”