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Moonves touts CBS retrans, Netflix deals

Topper stays silent on Sheen

CBS topper Leslie Moonves declined Monday to talk about the Charlie Sheen controversy, opting instead to deliver a math lesson about the future of the Eye net and a bullish outlook for this year’s upfront ad sales market. Meanwhile Time Warner topper Jeff Bewkes talked up the growth prospects of his TV Everywhere initiative during the Deutsche Bank media conference in Palm Beach, Fla.

During a lengthy Q&A, Moonves predicted that CBS could some day bring in $2.5 billion in annual retransmission consent revenues, well above his conservative projection of $250 million for 2012.

Here is his math: Distributors pay $26 billion a year in fees for programming. The four broadcast nets account for 40% of the TV viewing audience. That means networks should be paid about $10 billion of the total fees. If you split it evenly, CBS should be getting $2.5 billion, with Moonves arguing that the Eye should get even more because of its strength in ratings.

“Currently we are being vastly undervalued,” he said, adding that distributors aren’t paying fees for local news but for “the big ticket items,” like “CSI,” “NCIS” and “Two and a Half Men.” Moonves joked that the last item may be still to be determined. It was his only reference to the Sheen imbroglio during his nearly hourlong sesh.

On the upcoming upfront ad sales market, Moonves boldly predicted CBS would see double-digit gains. He based his optimism on the Eye’s recent track record in the scatter sales market, which is fueled by strong demand from markets and the Eye’s generally strong ratings.

In discussing the recent deal CBS struck with Netflix to license older shows for streaming, Moonves said the deal is smart because the revenue is additive and no show currently on the air is part of the deal.

“It doesn’t affect our food chain,” he said, noting that advertising and syndication revenue remain the priorities. “We are not going to risk billions for tens of millions.”

On the news division, Moonves said it was “extremely important” to CBS. He emphasized that CBS News is not a money-loser for the Eye, although he acknowledged it doesn’t make a whole lot of money. He did not address the future of Katie Couric as the expiration on her contract approaches in June.

Time Warner CEO Bewkes on Monday defended the pace of rollout of his brainchild, TV Everywhere, saying distributors covering 70% of the country now offer some form of the service that allows paying cable, satellite and telco subscribers to access cable shows via broadband on multiple devices.

Bewkes said virtually all cable, satellite and telco companies have embraced the concept. One reason more shows and channels aren’t available, he said, is that programmers are waiting to negotiate those streaming rights as part of their carriage agreements. That’s not the case at TW, he noted; the priority is to get programming up and running. “We know at some point, we will get paid,” he said.TV Everywhere was first announced by Bewkes and Comcast CEO Brian Roberts in July 2009.

While Bewkes criticized Net-flix and its perceived might in Hollywood earlier this year, he was much more muted on the topic on Monday. He said he believed subscription VOD services like Netflix had a place, but for shows much further down the window chain, past DVD and pay TV. He added that he would like to see “more vibrant competition” in the space with embedded subscribers from a different business — mail order.