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Crown Media Renews Deal With Comcast to Continue Carrying Hallmark Channels

Nov 29, 2007  •  Post A Comment

Crown Media Holding said it completed a renewal of its agreements with the nation’s largest cable operator, Comcast, to continue carriage of Hallmark Channel and Hallmark Movie Channel.
Hallmark’s carriage agreements with four of its largest distributors—Comcast, Time Warner Cable, DirecTV and Cablevision Systems—were due to expire at the end of the year.
Hallmark received almost no subscription fees from its largest carriers, analysts said, and getting sub fees that reflect the channel’s now-substantial ratings was a priority for new Crown CEO Henry Schleiff.
Mr. Schleiff declined to say how much Hallmark was getting in its new deals.
“It’s still less than we deserve, but we’ve narrowed the gap considerably,” he said.
Thomas Eagan, senior VP for research at Oppenheimer & Co., estimated that Crown was able to get between 4 cents and 8 cents per sub per month from Comcast.
While still a fraction of what other networks with similar ratings get, Mr. Eagan estimates the new Comcast deal will increase Crown’s revenues by 3% to $301 million.
“We would not be surprised if a renewal with Time Warner Cable is announced before [end of year 2007], followed by DirecTV in early-mid 2008,” Mr. Eagan said.
Mr. Schleiff said that with Comcast agreeing to a Hallmark deal, other operators may be easier to deal with.
“I think as a practical matter, that’s the logic behind it,” he said. “Comcast is well-respected, and deservedly so in terms of being tough,” and other operators might see the benefit of a similarly structured deal.
Mr. Schleiff had been in Washington in recent months discussing provisions that would require arbitration when independent networks like Hallmark cannot reach agreements with big cable operators. But that measure was not enacted as Federal Communications Commission Chairman Kevin J. Martin’s attempt to re-regulate cable failed earlier this week.
“Our ability to reach a mutually satisfactory agreement should indicate that, regardless of size or other factors, parties who operate in good faith can reach fair agreements without outside help or intervention.”
Under the new agreement, Comcast also will be able to carry the high-definition version of the Hallmark Movie Channel.
“Comcast is pleased to announce that it has renewed its affiliation agreement with one of the nation’s leading providers of family-friendly programming,” Madison Bond, executive VP of content acquisition for Comcast Corporation, said in a statement. “Hallmark Channel is a highly rated network with original movies and classic series, all delivered at a fair and reasonable price. Our goal is to serve the best interests of our subscribers, and there are few networks that offer them better programming or value than Hallmark Channel.”
12 p.m.: Updated throughout

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