Discovery Communications, Comcast Reach Agreement On Distribution (NASDAQ:DISCA)

Discovery Communications and Comcast have announced that they have reached an agreement on a new distribution pact. The distribution pact regards the carriage of Discovery’s 12 U.S. networks on Comcast cable systems. Those networks include Animal Planet, Discovery and TLC, three of Discovery’s most popular networks. The old distribution pact between the two companies reportedly expired last month.

As part of the pact, Comcast can include Discovery’s networks in its TV Everywhere service for Comcast Xfinity customers. The TV Everywhere service lets customers watch the channels carried by Comcast on mobile devices inside and outside the home. In a statement David Zaslav, chief executive of Discovery, said, “Comcast is a dynamic and innovative company and has been a great partner of Discovery’s for over two decades. We look forward to continuing our relationship and unlocking the value of Discovery’s content in even greater ways for Xfinity viewers.”

Comcast is known in the industry for tough negotiations with networks. TV ratings struggles and a weaker ad market have reduced programming companies’ clout when negotiating distribution deal renewals. The terms of the deal between Comcast and Discovery have not been disclosed. The announcement that the companies had reached an agreement was made on Monday.

The two companies have not been on great terms lately. Last year, Discovery was among the first companies to publicly express concerns about Comcast’s campaign to buy Time Warner Cable. Opponents of the deal said the proposed merger of the nation’s two largest cable operators would give the cable operator too much power in too many markets and would be harmful to consumers. Comcast responded that Discovery was using the government review process to improve its position in Discovery’s contract negotiations with Comcast. In a regulatory filing, Comcast wrote, “Such extortionate demands are patently improper.”



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