SNL Kagan Releases Updated Industry Retransmission Fee Projections:


U.S. TV station owners' retrans fees expected to reach $7.6 billion by 2019, versus the projected level of $3.3 billion this year according to SNL Kagan analysis

Monterey, Calif. (November 22, 2013– Announced today, SNL Kagan has updated their industry retransmission fee projections and now expect U.S. TV station owners' retrans fees to reach $7.6 billion by 2019, versus the projected level of $3.3 billion this year. The projections for growth are based on rising per-month sub fees for TV station owners in recent negotiations, as well as the consolidation of the business over the last couple years, which has often led to higher retrans rates after acquired stations are brought under larger groups' umbrellas. 

SNL Kagan's projections call for retrans revenues to rise to $7.15 billion by 2018, versus their 2018 projection of $6.05 billion from last year. In the year since SNL Kagan last updated their projections, the environment has improved for TV station owners, who have increasingly obtained rates they believe are closer to the value they bring to multichannel video services. 

The negotiation of digital rights has added complexity to retrans negotiations, with terms associated with distribution by the multichannel operator often more complicated to agree upon than the per-subscriber fee.  Affiliate groups must secure the rights to grant digital and second-screen distribution from their network partners when renegotiating their affiliation agreements, and there is not yet a cohesive industry approach. 

SNL Kagan's projections call for higher industry retrans fees versus this time last year despite the reduction of multichannel subs in their forecast. Whereas last year multichannel subscribers were projected to grow from 100.4 million at year-end 2011 to 103.7 million in 2018, this year SNL Kagan projects that in 2018 the multichannel industry will serve 100.6 million video subscribers.

SNL Kagan has also updated their reverse retrans projections, which project the funds flow from the affiliate and O&O stations back to their network partners.  Their projections show that the affiliate reverse retrans funds flow back to the networks could increase from $1.02 billion in 2014 to $2.25 billion in 2019. SNL Kagan shows reverse retrans payments back to the networks growing to 50% of affiliates' retrans payments over time, even as affiliates' monthly fees increase in the coming years. 

About SNL Kagan

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