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With New Distribution Deal, Comcast and Discovery Kiss and Make Up

Move past Time Warner Cable battle

Comcast's Neil Smit and Discovery's David Zaslav have brokered a new distribution deal. Getty Images

To paraphrase Taylor Swift, Discovery Communications and Comcast used to have bad blood, but now they've got mad love. 

After bitterly feuding last year over Comcast's attempted $45 billion acquisition of Time Warner Cable, the companies have buried the hatchet and agreed to a long-term renewal of their distribution agreement. The news, which covers Discovery's 12 networks—including Discovery, TLC and OWN–comes almost a month after their previous agreement expired.

The deal includes TV Everywhere rights, which gives Xfinity customers access to Discovery Communications programming on multiple platforms. According to a source familiar with the matter, the deal will stretch into the next decade, and the Comcast deal, along with its other recent distribution agreements, will help Discovery secure increases in the high single digits for its affiliate revenue. 

"Comcast is a dynamic and innovative company and has been a great partner of Discovery's for over two decades," said David Zaslav, president and CEO, Discovery Communications, in a statement. "We look forward to continuing our relationship and unlocking the value of Discovery's content in even greater ways for Xfinity viewers." 

"We're pleased to extend our relationship with Discovery and its family of networks under this long-term renewal agreement," said Neil Smit, president and CEO, Comcast Cable, in a statement. "This renewal will enable our Xfinity TV customers to experience Discovery's content in more ways and on more platforms than ever before."

The agreement caps a major thawing of the icy relations between the two companies last fall, when Discovery was one of the biggest opponents of Comcast's bid for Time Warner Cable. In a November call with investors, Zaslav said he was "concerned" about the deal, noting that it could have led to "a retraction of investment in content." Comcast, meanwhile, claimed Discovery and others had engaged in "extortion" by demanding network carriage and contract concessions in exchange for supporting the deal. 

Comcast abandoned its takeover plans in April, and the companies quickly moved to patch up their differences. A month later, Zaslav told analysts that Discovery had never actually opposed the deal. "What we said was that we had concerns about it," he said, adding, "That's all behind us now."

He also was optimistic that Comcast wouldn't let their battle spill over into negotiations over a new distribution agreement: "The goal now is to find a deal that makes sense for both of us." Now they have.

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