Nexstar Not Hurt by Retrans Fight

Despite a five-month-long retransmission-consent dispute, Nexstar Broadcasting Group Inc. claimed that ratings at stations that lost their cable carriage haven’t taken a big hit and that advertisers that initially left are coming back.

“The impact to us is decreasing as time goes on, as life goes on and as people find out that our ratings didn’t go down by the number of cable homes or the percentage of cable homes that we weren’t reaching,” Nexstar CEO Perry Sook said Wednesday.
A Cable One spokesman disputed Sook’s claim, saying that Nielsen Media Research data showed that ratings for Nexstar’s Joplin, Mo., stations were down in February.

During a first-quarter conference call, Sook also told Wall Street analysts that his company recently wrapped up a big contract with an operator that secures cash-for-carriage for its stations — and that Nexstar will continue to seek such compensation from Cox Communications Inc. and Cable One Inc., who it is in a standoff with.

“At this point, we think it would be a mistake to ignore the value that our television stations bring to the cable offerings in these local markets to begin with, and we want to establish some foundation or basis there,” Sook said.

“Two weeks ago, we signed the largest cable retransmission-consent, per-subscriber-fee deal in the company’s history, at a company that I am not at liberty to name,” he added. “We are signing deals with wire-line cable companies on a regular basis that are paying us on a per-sub-fee basis. We just haven’t cracked the Top 10 MSOs yet.”

After failing to reach renewals on retransmission-consent pacts with Nexstar, Cox lost NBC affiliate KRBC in Abilene, Texas, and CBS affiliate KLST in San Angelo, Texas, on Jan. 1 and then NBC affiliate KTAL in Texarkana-Shreveport. Similarly, Cable One had to stop carrying KTAL, as well as ABC affiliate KODE and NBC affiliate KSNF in Joplin, Mo., Jan. 1.

In a prepared statement, Sook said that the financial impact of the ongoing dispute “is significantly less than we budgeted for.”

The Nexstar stations that Cox and Cable One had to drop initially had cancellations from advertisers, according to Sook. Those advertisers were concerned about what impact the loss of cable distribution would have on the various stations’ ratings.

But the February sweeps demonstrated that Nexstar’s stations fared well in the ratings, according to Sook.

“We did see cancellations and advertisers that stayed away in the first quarter,” he said. “As the February ratings data became known —and ratings for the NBC station in Shreveport [La.] were up, the ABC station in Joplin [Mo.] were up, the 10’o clock news for the NBC station in Joplin was up over the prior year — and those facts became known to us and to advertisers, we have seen folks who stayed away come back. And we’ve added some new advertisers along the way.”

Sook maintained that Cox and Cable One customers are getting his stations’ signals either via rabbit ears, or by switching to direct-broadcast satellite.

“Because we’re not going into the home on a cable wire does not mean we are not going into the home,” he said.

Sook also said he were encouraged by the fact that Viacom Inc. co-president and co-chief operating officer Les Moonves has publicly said his company will likely be seeking cash compensation from cable operators for its CBS owned-and-operated TV stations.

“We’re glad to hear that here are others who see the value proposition that this would create long-term for broadcasters,” Sook said. “I’ve had three different broadcast companies — one public and two private — that approached me at the NAB [National Association of Broadcasters], that want to do conference calls. They want to learn what we’ve learned at this point as they go to make their decision how and when to engage in this debate.”