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Friday, February, 8 2013

Optimum West deal will give Charter $10 mil.-plus in ad revenues

By: Stewart Schley Friday, February, 8 2013

Charter Communications Inc. won’t just get 300,000 more cable TV subscribers when it of Cablevision Systems Corp.’s western U.S. division. It also adds local advertising operations in four states that should add more than $10 million annually to Charter’s advertising revenue.

Cablevision is selling its Optimum West unit to Charter for $1.6 billion in a deal expected to be completed after mid-year. The system group, formerly owned by Bresnan Communications, includes advertising operations in Montana and Wyoming that are managed by Optimum directly, along with ad sales operations in Utah and Colorado that are repped by Comcast Spotlight.

It probably makes sense for those representation arrangements to stay in place after the transaction happens, given that Charter Media has no physical presence in Utah or Colorado. Charter Media’s west division, which has the closest geographic alignment with Optimum West, manages ad sales operations in California, Nevada, Oregon and Washington.

In 2011, the Optimum West group produced $11.6 million in advertising revenue, according to Cablevision’s 2012 annual report to shareholders. That equals about $36 per subscriber in annual revenue. (Charter Media’s advertising revenue for the last full year reported, 2011, was $292 million.)

Optimum Media’s biggest market is Billings, where Optimum offers TV ad placement on 36 networks spanning 8 ZIP codes. Other Montana markets include Bozeman (31 networks and 5 ZIP codes), Helena (31 networks/7 ZIPs) and Missoula (31 networks/14 ZIPs).



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