Showtime Networks Is Crucial to CBS' Success
Trefis submits:
The recent deal between Fox (NWSA) and Time Warner Cable (TWC) is indicative of how the erosion in TV ad dollars has led to changes in the long-established broadcast TV revenue model. Sustaining a broadcast network solely on ad dollars is becoming more challenging leading networks like Fox to demand an additional revenue stream in the form of subscriber fees charged to cable companies like Time Warner. Other broadcast networks (CBS, ABC (DIS), NBC (GE)) face challenges similar to those at Fox. The situation could be particularly troublesome for CBS which is less diversified compared to other media conglomerates (Disney, News Corp). The CBS broadcast network accounts for nearly one third of CBS’s stock value making the company as a whole highly vulnerable to TV ad pricing. CBS does, however, own Showtime Networks which works on a subscription model and can continue to do well in weak TV ad environments.Complete Story »
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