Les Moonves: TWC Blackout Will Cost CBS 'Virtually Nothing'
Les Moonves was taking a victory lap on Wednesday for successfully negotiating escalated retransmission fees from Time Warner Cable, and he said the recently resolved dispute will cost CBS "virtually nothing."
The CBS chief executive told Wall Street analysts that, while CBS almost never goes dark, TWC has "gone dark with a number of companies through the years." In the CBS-TWC dispute, the network was cut off from cable customers for 32 days.
He said a protracted dispute recently settled with TWC could lead to "less contentious" negotiations in the future between suppliers and distributors of television content. He said he knows the fair market value for CBS content, and he will do his best to ensure the network is fully compensated.
"We look for fairness," Moonves said Wednesday at the Bank of America Merrill Lynch 2013 Media, Communication & Entertainment Conference in Beverly Hills. "If you supply good content, you should get paid for it."
He also said that while the FCC is looking into the CBS-TWC dispute that knocked the network off the air for millions of consumers, he doesn't anticipate more regulatory intervention into the TV business from the dispute.
"We don't think the government should get involved. We don't think they will get involved," he said. "We believe in the free marketplace -- frankly, so did the cable companies when they had a bit of a monopoly. Now suddenly there's a different tune since there is competition and they're urging the government to get involved. We think that's exactly the wrong thing to do."
Moonves said in the third quarter Wall Street will see that the fight with TWC equaled "no harm done financially." Though he acknowledged CBS took a public-relations hit, it wasn't nearly as big as that of TWC, which he joked routinely angers consumers with service calls that are "six hours late."
"Look, when you're in a dispute like that, there are no heroes, there are two big companies. The average guy in the street is not getting his CBS programming -- there are no good guys or bad guys from the consumers' point of view," he said. "I think PR-wise, I would think more people were against Time Warner Cable. You know, those are all the people who have the guy show up six hours late for their installation."
Earlier at the same conference, TWC COO Rob Marcus said the dispute with CBS caused some customers to disconnect the cable service and that marketing expenses had to increase to repair the damage. "There was a fair amount of pain we had to endure," he said.
Moonves also said Monday that the value of the 27 stations that CBS owns saw a significant boost because retransmission fees have escalated, and that he'd entertain selling some of the stations but for much more money than he might have gotten for them a year ago.
"I guess in some of our smaller markets there might be a station or two, if the offer is right, that we would sell," Moonves said. "But guess what, the value of these stations over the last 12 months have gone up substantially, and right now people know why. They're all saying, 'Oh my god, retrans is a serious amount of money.' "