CBS Inks Retrans Deal With Verizon

CBS has notched its second retransmission-consent deal of the new year, hashing out a long-term agreement with Verizon that secures network’s existing carriage on FiOS TV, while broadening the terms to provide more options to subscribers of the V CAST wireless network.

Under terms of the new agreement, Verizon has secured mobile rights for full episodes of several CBS series, including prime-time dramas and the broadcaster’s weekly newsmagazine, 60 Minutes. Although daytime shows are also part of the package, the late-night daypart was not addressed in a Jan. 12 statement released by both parties.

The deal also encompasses video-on-demand rights for shows like CSI, NCIS and Survivor. Financials were not disclosed.

FiOS TV is available in 14 states, reaching more than 1.6 million subscribers.
“Verizon is focused on providing the most comprehensive and exciting entertainment to our customers across all our services and platforms,” said John Harrobin, senior vp of digital media, Verizon. “We’re pleased to extend our relationship with CBS, which helps us deliver the hit shows and compelling content our customers want to enjoy.”
CBS closed its first major retrans-consent agreement of 2009 a week ago, coming to terms with Time Warner Cable. The broadcaster is presently in talks with other large carriers, including cable giant Comcast and fourth-ranked Charter Communications.

UBS analyst Michael Morris estimates that CBS will pull in around $196.6 million in retrans dollars each year, with the Time Warner deal contributing about $22.2 million of the broadcaster’s O&O haul.  

In a note to investors, Morris said that while incremental, retrans is a drop in the bucket compared to CBS’ reliance on advertising dollars. UBS forecasts CBS’ ad sales revenue to experience a 12.8 percent decline in 2009, dropping $681 million to $4.65 billion. “Even at the high end of retransmission potential, the revenue contribution remains modest compared to advertising,” Morris said.