Panel: Retrans Pie Will Grow

New York — A panel of top analysts said that retransmission consent revenue is becoming more important than ever, as major broadcast networks aim to spend heavily on pricey programming like sports, and could force even greater disparity as those networks look to extract a greater chunk of the pie through reverse compensation.

At the TVB Forward conference here Thursday (Sept. 27), panel moderator, S&P Global Market Intelligence senior director, research Robin Flynn said CBS has already thrown down the gauntlet, saying it is seeking $3 per month per subscriber in retrans revenue and $2 per month per subscriber for reverse compensation from station affiliates.

JP Morgan media analyst Alexia Quadrani said that while she sees the overall retrans pie growing, the cut going to local broadcasters could shrink.

Quadrani said smaller station groups will probably feel the most pressure — she estimated that while station affiliates normally split 50% of their retrans revenue with their respective networks, for smaller stations the amount going to the network in some cases approaches 75%.

“The networks are going to have to obtain more live content, because that is what everyone is watching and that has the highest price tag,” Quadrani said. “They’re [networks] going to have to pay for that somewhere and so I think overtime we will see more pressure on reverse comp.”

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