CBS and Comcast, biggest US cable provider, reach long-term deal on broadcast fees

CBS and Comcast reach long-term deal on fees

NEW YORK — Comcast Corp. has locked in access to CBS Corp. programming for the next decade and will be able to expand on-demand access to the company’s shows in a deal announced Monday.

The agreement is unusual because most of these agreements between broadcasters and cable TV providers are negotiated every few years.

The deal, which covers the CBS television network, Showtime Networks and the CBS College Sports channel, could head off the kind of dispute that flared earlier between the Fox television network and Time Warner Cable.

That dispute left millions of people wondering if they’d be able to see a college football bowl game and other shows. Only a last-minute deal kept Fox programming on Time Warner’s slate of channels.

In March, Cablevision Systems Corp. customers lost their ABC station in New York in the hours leading up to the Oscars. It wasn’t restored until the two sides reached a tentative deal, and viewers missed the first 15 minutes of the awards show.

Broadcasters get a fee — say, $1 per cable subscriber — for allowing Comcast and other pay-TV providers to carry the channels on their lineups.

As the recession forced businesses to cut budgets for TV advertising — traditionally the main source of revenue at broadcast stations — television networks started asking for a higher fee per subscriber. The cable TV companies have resisted, saying higher fees get passed along to customers in the form of higher cable bills.

The deal announced Monday could help the top-rated broadcast network and the biggest U.S. cable provider avoid a showdown — at least until 2020, when the companies will have to negotiate the fee again.

“I think it’s a great template for some of the other deals we’re doing,” CBS chief Les Moonves said in an interview.

The companies did not say how much CBS will get from Comcast per subscriber.

They said the agreement also allows for more on-demand access to Showtime and CBS programming. Moonves pointed out that CBS has a vast library of television shows, which could provide Comcast subscribers with more on-demand options.

The deal comes as Comcast is poised to expand its own programming operations with the takeover of NBC Universal. Comcast’s purchase of a controlling stake from General Electric Co. is awaiting regulatory approval.

CBS shares were up 52 cents, or 3.5 percent, to close Monday at $15.30, while Comcast rose 1 cents to $19.48.

(This version corrects that purchase would be from GE, rather than in GE.)