Comcast, owner and operator of the Xfinity cable service, has reached a carriage agreement with Warner Bros. Discovery that will keep TNT, TBS, and other Warner properties on Xfinity airwaves for at least the next several years, according to multiple reports Monday morning.
Per the Wall Street Journal, the deal is similar in nature to the agreement Warner Bros. Discovery reached with Charter Communications earlier this year which allowed Charter the right to bundle Warner’s Max streaming service to its pay-TV customers at no additional charge. Comcast has negotiated similar rights to bundle Max’s ad-supported tier.
Notably, reports conflict as to the rate Comcast is paying for TNT, which next year loses broadcast rights to the NBA. Comcast’s NBCUniversal secured a package of games that includes much of TNT’s current NBA inventory, while Amazon will begin broadcasting a third package exclusive to streaming. The Wall Street Journal contends that Comcast’s new agreement with Warner Bros. Discovery “keeps TNT rates flat,” at roughly $3 per month, while Variety reports that “a source familiar with the renewal said that Comcast is paying lower carriage fees for TNT and TBS given WBD’s loss of NBA games…”
Either way, as expected, losing the NBA was a major point of discussion in these negotiations. Some industry observers speculated while NBA media rights negotiations were ongoing that part of the reason Comcast was willing to pay so much for its package was that they would save money on the back end via lower carriage fees for TNT.
For Warner Bros. Discovery, the deal means a level of stability. With two major carriage agreements now inked with Comcast and Charter, the company can now enter negotiations with other large distributors with a roadmap to a deal, despite no longer having the NBA.
The deal comes at a precarious time for the cable television industry writ large. Even with the new deals in place, Warner Bros. Discovery still “took a $9.1 billion write-down on the value of its cable networks,” earlier this year according to the Wall Street Journal. Comcast has also acknowledged the challenges to the modern pay-TV business, recently announcing plans to spin off a large majority of its cable assets.
The uncertainty surrounding the industry makes deals such as these even more important for Warner Bros. Discovery, which does not own a diversified set of businesses like that of Comcast or Disney. Given the circumstances, Warner Bros. Discovery is likely satisfied with any kind of long-term deal that can help keep its suite of cable channels intact.
