CBS said it expects to grow retransmission consent revenue by 25% in 2017, adding that it is on track to delivering $2.5 billion in retrans revenue by 2020.
CBS has been one of the most aggressive broadcasters on the retrans front, and continued on its torrid growth pace in 2016, fattening its retrans and reverse compensation coffers by 35% for the year to more than $1 billion. With about 33% of its footprint scheduled for retrans renewals in the next two years – and 26% ready for reverse compensation renewals in the same time frame – there is ample opportunity to grow.
CBS also said it has reached a carriage deal with Hulu for its upcoming streaming service and though it has not yet reached an agreement with AT&T’s DirecTV Now streaming service offering, it is in talks with the distributor.
“We are still anticipating conversations and hopefully we come to a good resolution with them,” CBS chairman and CEO Les Moonves said on a conference call with analysts to discuss 2016 results. The broadcaster also said it had reached a carriage agreement for CBS, Showtime, The CW and other properties with Verizon Communications.
CBS’ own over-the-top offering, CBS All Access, has been outperforming expectations and Moonves said that estimates that it and the Showtime OTT service would reach a collective 8 million customers by 2020 could be “too conservative.”
Moonves wouldn’t offer a new target; only that it would be above 8 million customers. And he added that CBS All Access hasn’t yet introduced all of its exclusive original programming – The Good Wife spin-off The Good Fight debuts Feb. 19 on CBS before moving to All Access and its Star Trek: Discovery series is slated for May. The introduction of those new shows should help drive even more subscribers to the service.
CBS All Access began offering live NFL games in December, but chief operating officer Joe Ianniello said on the call that live sports and events aren’t a big draw for the offering. About 10% to 15% of total viewing on All Access is sports and live events, with the bulk of viewership geared toward on demand programming, he said.
Moonves also hinted that CBS would purchase more stations if new Federal Communications Commission chairman Ajit Pai were to raise the cap on station ownership, but quickly added he had no knowledge the chairman would do so.
"Local markets have been extremely good for us," Moonvves said.
