) further strengthened its ties with
) by announcing the extension of its multiyear streaming video
deal for select library content. However, the terms of the deal
were not disclosed.
The move is a strategic fit for CBS as the company continues
to benefit from its streaming deals, evident from the strong
double-digit growth in streaming revenues during first-quarter
2013. Moreover, the company's strategy of adding diverse revenue
streams makes it less susceptible to economic woes.
CBS has entered into long-term streaming deals for CW content
with Netflix and Hulu, which is expected to boost its operating
results. Moreover, the company entered into a deal with
) that extends the latter's archive of television shows and films
currently available on its streaming video site, Amazon Prime
Instant Video. These measures facilitate CBS in monetizing its TV
As per the extended licensing agreement, new titles such as
will now be available to Netflix subscribers.
Going forward, CBS Corporation's sustained focus on increasing
subscription based revenue channels is expected to be a long-term
growth driver. We expect the company to benefit from reverse
compensation from affiliates, strong demand of its content,
digital distribution, syndication sales and retransmission
Alongside, CBS Corporation acquired the remaining 50% stake in
TV Guide Digital, including the TVGuide.com and TV Guide Mobile
Lions Gate Entertainment Corp
). The addition of TVGuide.com to CBS' impressive portfolio is
believed to be a major boost for the company's digital business
as both TVGuide.com and TV Guide Mobile enjoy a strong audience
in the lucrative TV information category.
Despite these positives, CBS currently holds a Zacks Rank #4
(Sell) as secular headwinds remain a concern for broadcast-driven
media companies in the near term.
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