Comcast (NSDQ: CMCSA) has had some success with NBCUniversal programming since it took control early this year — taking credit for greenlighting Suits and Necessary Roughness on USA is pushing it, helping The Voice to a win has merit. But so far the real added value in NBC’s content comes from outside: retransmission fees and online video sales.
When Merrill Lynch analyst Jessica Reif Cohen asked during today’s earnings call about the potential for content value post-deal, NBCU CEO Steve Burke, a chief architect of the merger, said: “I do think it’s more valuable today then when we did the deal. Retransmission consent is a bigger number and the kind of money online video providers are paying is significantly greater.” Usually a careful speaker, Burke first described online video pay as “infinitely” greater before settling on “significantly.” My guess is it could be both, especially since Netflix (NSDQ: NFLX) isn’t alone in spending and it isn’y only about NBC or even cable. NBCU’s Universal Pictures just notched a deal with Amazon (NSDQ: AMZN) that should make a nice addition to this quarter’s online video revenue and its new deal with Netflix is all about past seasons of current shows and library.
That won’t be enough to change the overall picture. NBC, usually mired in fourth place among the broadcast networks, has to come through. Burke described the massive Comcast-wide publicity effort behind The Voice and the added investment NBCU put into the show. That earned a #1 spot in the last four weeks at the end of the quarter but Burke is still keeping expectations very low, warning that NBC likely will stay in fourth overall for the next two years, and possibly longer. More to come.