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Thursday, November 02, 2006

Comcast and Disney: Too Cozy? (CMCSA)(TWX)(DIS)

According to the Los Angeles Times, which is for sale by the way, Disney is working on a new deal to distribute its content over the two largest cable systems in the country, Time Warner Cable and Comcast. The paper says that Comcast already pays Disney about $1 billion a year for programming on its basic cable platform.

As part of the overall deal, Comcast may buy Disney’s 39.5% share of the E!Entertainment Network for $1.6 billion. You have to wonder if Comcast will get a slightly better deal on what it pays for Disney programming if it takes a dog like the E! Network off Disney’s hands. E! averages about 469,000 viewers in prime time. That puts it behind stand-out networks like Animal Planet.

If any of the other cable networks want a good deal with Disney, they may have to overpay to take one of the theme parks off of the company’s hands.

Douglas A. McIntyre can be reached at He does not own securities in companies that he writes about.

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