03.05.2007 08:00 AM
Sinclair, Comcast extend deadline on retransmission talks

The deadline was extended last week to finalize retransmission negotiations between Sinclair Broadcast Group and Comcast Cable. The new deadline is March 10.

Sinclair is demanding that Comcast pay it for cable retransmission of its broadcast programming. If the companies cannot come to terms, millions of cable viewers will lose access to Sinclair's programming. Comcast carries Sinclair stations in Baltimore, Pittsburgh, Minneapolis, Nashville, Tampa, and Richmond, VA.

The negotiation, and its outcome, is setting the stage for much bigger battles, especially as CBS faces similar retransmission negotiations with Comcast and Time Warner in two years.

The "New York Post" reported last week that Comcast and Time Warner, which collectively have nearly 38 million subscribers, would reject CBS' demands when their current carriage agreements expire in 2009. Citing sources, the newspaper reported that the cable operators are not taking the network seriously.

"It's going to be pretty difficult to argue with a straight face that Comcast or Time Warner should pay for what anyone who has a television antenna or an Internet connection can get for free," Craig Moffett, an analyst for Sanford Bernstein, told the "Post."

The cable operators, Moffett noted, also have the advantage of being able to inflict serious damage on CBS' advertising revenue in the event of a standoff. A good 34 percent of the network's advertising revenue is derived from Comcast and 13 percent from Time Warner, he said.

Sinclair, which recently settled a heated retransmission battle with Mediacom, has pushed hard for a cash payment. The broadcaster wants to receive $48 million in retransmission consent fees in 2007, about double what it received from Comcast last year.

Philadelphia-based Comcast has 24.2 million cable customers. About 3 million of those, in 23 markets, receive Sinclair stations.

Analysts told the Associated Press that Sinclair has less leverage in its negotiations with Comcast than it did in the Mediacom dispute. Sinclair pulling the stations, which could jeopardize Sinclair's advertising revenue, would affect a larger percentage of Sinclair customers than Comcast customers.



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