Cable Operators

Analyst: TWC Should Auction Off CBS Channel Spots

Says Channel 2 in NY and LA Could Attract Interest 7/22/2013 9:16 AM Eastern

As the carriage dispute between Time Warner Cable and CBS edges closer to its July 24 day of reckoning, BTIG Research media analyst Richard Greenfield suggested the MSO auction off the broadcaster’s channel positions in its two top markets as a way to gain additional leverage as well as fill its coffers with additional cash.

In a blog posting Monday, Greenfield suggested TWC auction off the Channel 2 position on its New York and Los Angeles systems, a move that would add to the cable operator’s already significant leverage in negotiations.

Greenfield has noted in past blog postings that he believes CBS has overestimated its clout in the ongoing talks – National Football League games and other significant content are not scheduled until mid-September, about two months away.

Other analysts have taken a different tack, claiming that CBS’ No. 1 network status gives it the upper hand.   

“We believe the threat of permanently losing its coveted ‘channel 2’ designation in the two largest advertising markets is a meaningful threat as well,” Greenfield wrote in his most recent posting.

The analyst suggested TWC begin soliciting financial offers for the channel spots on Wednesday evening.

“Imagine if a struggling network such as CNN (which was demoted on the dial four years ago) agreed to pay Time Warner Cable a substantial fee to switch back to even more prime dial real estate,” he asked.

Time Warner Cable and CBS have been trading barbs in competing ad campaigns over the past few days,  with TWC claiming the broadcaster is asking for a 600% premium to what other CBS broadcast stations charge it on average. CBS counters TWC is refusing to negotiate the same sort of deal that other distributors have reached with the network.

Time Warner Cable declined comment.

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