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Analysts’ best guesses on FOX/TWC settlement amount
Multichannel News polled industry analysts who weighed in with their estimates on how much the television network was able to squeeze from the cable company for the right to retransmit FOX stations and other Fox broadcast holdings. FOX was demanding $1 per month per subscriber.
According to the article, Miller Tabak media analyst David Joyce suspects that TWC paid between 40 cents and 60 cents per subscriber per month. Collins Stewart media analyst Tom Eagan said it’s unlikely that TWC received the $1 fee it was seeking, but that, in any event, whatever the cable giant has to pay will have little impact on the company’s profits. Eagan estimated that even a fee of 75 cents per subscriber per month would only reduce TWC’s 2010 cash flow by 0.56%, and that’s if none of the additional cost is passed on to subscribers (and he believes that it will be).
The analysts suggested that the final deal included several moving parts, including revenue for Video on Demand and HDTV channel capacity, and that it’s likely that both sides were forced to compromise.
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