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Leslie Moonves: TW Cable Blackout Had No Financial Impact on CBS

Advertising dollars 'did not go down at all,' Eye chief sez at investor confab

CBS’ 32-day blackout on Time Warner Cable systems did not put a dent in the Eye’s bottom line, CBS Corp. prexy-CEO Leslie Moonves told an investor confab on Wednesday.

“Our national ad dollars did not go down at all,” Moonves said in a Q&A session at the Bank of America Merrill Lynch Media, Communications and Entertainment conference in Beverly Hills. He said the Eye’s upcoming third-quarter earnings report will prove “there was no harm done financially to the CBS Corporation” from the loss of coverage on TW Cable systems in New York, Los Angeles, Dallas and a handful of other markets.

Moonves reiterated that it was TW Cable’s call to pull the CBS stations and Showtime off the air — which marked a first for CBS going dark in a retransmission negotiation. But Moonves has no regrets for holding out for the deal that  eventually came together over Labor Day weekend — especially CBS’ balk against TW Cable’s effort to restrict the Eye’s ability to strike digital distribution deals for its programming.

“At the end of the day we were fighting for something very important. We need to get paid for retransmission and we need the right to put our content elsewhere,” he said. “We ended up in a very good position.”

As for the heightened government scrutiny on retrans deals after the lengthy dispute, Moonves underscored the assertion of broadcasters that the FCC has no business referring private business negotiations. “We don’t think the government will get involved. We don’t think the government should get involved,” he said. “I’m hoping what happened (with TW Cable) will help make these negotiations less contentious,” given that the eventual deal wound up mostly in CBS’ favor, he said. “We think if you supply good content you should get paid for it.”

Among other topics Moonves touched on in the wide-ranging sesh:

**  He predicted a big shift on the horizon for the ratings standard for advertising deals, extended the DVR playback period from three days to seven days. “A year from now we’ll be in a C-7 world. Our content will carry the exact same commercial load as the network (airing) and we’ll get paid for it 100%.”

** CBS’ overall revenue from retrans deals and reverse comp pacts with affiliate stations (as those stations harvest more retrans money) will be worth $1 billion by 2017. Moonves called that a “very conservative” estimate.

** The success of summer series “Under the Dome” was magnified by the fact that the second-window deal with Amazon made the show profitable from the start. The ad revenue boost generated by the show will be reflected in CBS’ 3Q results, Moonves assured.

** Even as CBS is in the midst of selling off its outdoor advertising assets, the Eye has no intention of selling publishing arm Simon and Schuster.”

** TV Guide Network, in which CBS acquired a 50% stake for $95 million earlier this year, is “a shiny new toy” that has a lot of upside potential for CBS Corp. The CBS network team has taken it under wing as “a kid brother network.”

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