Fox's Reilly: Cablevision Needs to Share $550M in Re-Trans Profits

Kevin Reilly leads off with pugnacious response to carriage-battle question during Tuesday's Hollywood Radio TV Society network-presidents luncheon panel; Tassler, Lee, Reilly and Ostroff also on hand

Right away, the TV industry pros in the Beverly Hilton banquet room — packed more than usual Tuesday — knew boredom wasn't going to be a problem.

Even before the panel of network entertainment presidents — including CBS' Nina Tassler, ABC's Paul Lee, NBC's Angela Bromstad and The CW's Dawn Ostroff — tore into the subject of overnight ratings, Fox's Kevin Reilly dealt with a question about how his company's increasingly heated retransmission battle with Cablevision was going.

"Take it up with Cablevision," the Fox network entertainment chief responded testily to Kevin Beggs, the president of Lionsgate Television, who was moderating Tuesday's noontime Hollywood Radio and Television Society lunch panel.

Also read: "Fox Warns Cablevision: Stop Telling Customers to Steal Our Content."

It was the first time the HRTS has been able to convene all five network entertainment presidents at one of its noontime events since just before the 2007 writers strike.

Reilly noted that under Cablevision's fee structure, customers individually pay about $15 for broadcast-network re-transmission, which yields what he described as a $550 million profit for the company. 

So why aren't broadcasters like Fox getting more of that money? he openly wondered.

With broadcasters striving to build cable and satellite re-transmission into the kind of viable second revenue stream cable networks have enjoyed for years, Reilly repeatedly hammered away at what he sees are broadcast TV's inherent advantages over cable.

 "I don't know why the USA Network gets compensated so well for 'House' reruns and we don't get compensated nearly as well for 'House' originals," he said.

And he kept the hits comin'.

"If I were still at FX, I would have taken out a double-truck ad for (the recently canceled) 'Lone Star," and I would have touted my 1.3 demo rating, because that's the same rating 'Mad Men' gets," he said. 

After Reilly finally gave the cable business a break, Beggs brought up the subject of overnights.

The word "obsolete" came to mind, with network decision makers telling the audience that they can no longer derive actionable data from overnight ratings, given the proliferation of DVR usage and various other viewing platforms.

"The overnight number doesn't tell the whole story anymore," said Tassler, the veteran of the group, having been appointed to CBS's entertainment presidency back in 2004. "'The Mentalist' gets 3 million more viewers once Live Plus 7 numbers are factored in."

The current plethora of ratings benchmarks is "fascinating to me," added Lee, having just been promoted from ABC Family in July. "On Tuesday morning, you find out you lost Monday night, but you've won it by Thursday … and then you've lost it again by next Monday."

The panelists also discussed the possibility of another strike, with the Writers Guild of America issuing a pointedly progressive bulletin Monday as it readies to renegotiate a major contract that expires May 1.

"That was rough on everybody," Tassler said. "We're just beginning to feel the blood run through our veins again, so another strike would be bad."