While retransmission (retrans) fees from multichannel video programming distributors (MVPDs) constitute a relatively new practice, their exponential growth in just a few years has made this revenue source a primary component of a broadcaster’s total revenue and valuation, and the most important driver of growth. However, retrans fees are also a very complex and laborious revenue stream for Finance Departments to manage for compliance, revenue assurance, cash application, and reporting purposes.
The proper management of retrans fees is a task few companies are equipped to do to meet the expectations and needs of top management. The complexity, dynamic nature and materiality of these fees may require very high investment from broadcasters to adequately manage as these firms may need to increase headcount and develop or acquire/maintain complex software solutions. Therefore, what was planned as proper revenue management by responsible management can easily morph into a dangerous distraction from broadcasters’ core business. MAI therefore provides a service to manage the process for these companies.