Which Op Will Pay CBS Cash for Retrans?

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Speculation was rampant on the identity of the mystery cable operator that has agreed to pay cash to CBS Corp. for retransmission consent after comments by CEO Les Moonves at an industry conference Tuesday, but most of the potential candidates have taken themselves out of the running.

At the Bear Stearns & Co. Inc. media conference Feb. 28, Moonves said CBS would announce a deal within six weeks with an operator with 3 million-5 million subscribers. Moonves wouldn’t divulge the name of the operator, nor the terms of the deal, but he noted that other smaller cable networks are getting carriage fees of 25 cents per subscriber, per month from cable operators.

“We should be worth more than that,” he added.

Because the retrans deal could only involve markets where CBS owns and operates a station, that limits the number of operators that could be involved. CBS has about 39 O&O stations across the country.

The majority of those O&Os are in Comcast Corp. markets like San Francisco, Boston and Minneapolis. But Comcast has far too many customers in those areas -- more than 14 million -- so that takes it out of the running. And Comcast already did its retrans deal with CBS (not for cash), and it has several years remaining on the deal.

Cablevision Systems Corp., with 3 million subscribers in the New York metropolitan area -- another CBS O&O -- also seemed a perfect candidate, but chief operating officer Tom Rutledge nixed that idea later at the same conference.

“In New York, we have a relatively strong position,” Rutledge said. “We are not paying for any retransmission consent.”

Another candidate -- Time Warner Cable -- also seemed to be a good fit, with about 4 million subscribers in CBS O&O territories, but it, too, denied paying cash to CBS.

“This is not us,” Time Warner Cable spokesman Mark Harrad said.

Charter Communications Inc., with 6.3 million subscribers, also denied that it was the MSO in question.

And Cox Communications Inc. has 5.9 million subscribers, but spokesman David Grabert said the Atlanta-based MSO was not the subject of Moonves’ comments.

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