Cable Retrans Fees On Rise

Retrans fees paid by basic cable networks are still a fraction of overall network/
programming carriage fees paid by cable networks. But those retrans fees are expected to rise quickly.

SNL Kagan says broadcast fees amounted to 8.9%, or $3.3 billion of the $37.3 billion in total revenue that cable operators pay basic cable networks and regional sports networks.

The share of retransmission fees for cable operators is expected to rise to a 10.5% share in 2014; 11.4% in 2015; 12.1% in 2016; and 12.5% in 2017.

By 2017, retransmission fees are estimated to be $6.6 billion -- and all basic cable network/regional sports network fees paid by cable operators will get to $52 billion, according to SNL Kagan.

SNL Kagan says broadcasters have said TV stations deliver 35% of a typical cable system's TV viewing, but collect just 10% of the programming fees.

SNL Kagan says ESPN continues to be at the top of the list for all basic cable networks -- collecting $5.04 per sub per month on average in affiliate fees in 2012. It says TNT grabs an average $1.20 month in affiliate fees.

Previously, SNL Kagan also said “reverse retransmission”  revenue -- where money goes from network affiliates and O&O stations to TV networks -- is estimated to grow as well, from $1.02 billion in 2014 to $2.25 billion in 2019.

"Watching TV" photo from Shutterstock.



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