By Nicole Sims
TV’s biggest cable networks and programmers have had nothing to say regarding Comcast’s $45.2 billion takeover of Time Warner. The trend continued at a Senate pannel Wednesday where you could hear a pin drop when it came time for them to testify against the industry changing deal.
Although networks like CBS, Century Fox, and Discovery have kept quiet, it’s clear that they don’t want and tension between them, and a company that’s become a serious source of revenue.
Programming accounts are the largest portion of Comcast’s expenses. Last year alone it was about $9.1 billion. This enormous amont of money is mostly paid out to the six major networks, some of which outspoken CEO’s suddenly have lost their tongues.
To put this figure in perspective, Viacom’s total revenue for 2013 was 13.8 billion, and 9.7 billion came from cable networks.
More power quite literally means paying more money for Comcast. The amount of money Comcast paid Viacom was based on the number of TV subscribers, and Comcast’s 21 million subscribers amounted to quite a large paycheck. So a majority of Viacom’s revenue came from none other than Comcast.
A pretty paycheck isn’t the only thing keeping other networks quiet. Comcast also has some serious leverage over programmers when it comes to negotiating carriage agreements.
If the Comcast-Time Warner deal is approved the company will serve as an even bigger threat. As Senator Amy Klobucher said at the hearing, “many programmers are afraid to go public with concerns” because it’s become “increasingly hard to negotiate agreements.”
An example of this fact can be shown by DirectTV dropped The Weather Channel in January, only to restore it weeks after when the network forced the program into major concessions.
When it all boils down, networks and programmers seem to have a lot more to lose than gain.
So who’s afraid of the bug bad wolf?