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Rogers Inks Multi-Year Deal with AMC

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Rogers Communications Inc. (RCI), the largest cable operator in Canada has reached a multi year deal with AMC Networks Inc. (AMCX) that will line up the AMC Network channels with Roger’s digital cable.

Following the deal, Roger’s digital cable customers can enjoy AMC’s popular TV series including Breaking Bad, Mad Men and The Walking Dead in HD format. Additionally, Roger subscribers will also be able to enjoy new and upcoming TV series like The Killing, Hell on Wheels and Low Winter Sun slated for release this year.

The agreement enables customers to view AMC’s original series across multiple platforms like Rogers on Demand channel and Rogers Anyplace TV on Demand, soon after the original television. AMC programs are available to Rogers VIP package customers, while the SD package customers will get the HD version starting this month. However, the financial terms of the deal were not disclosed.

The deal marks the end of a dispute between the two companies over contract renewal. Roger’s digital customers received threats from AMC over a possible channel black out after the previous contract between the two expired on Feb 28, 2013. Signing the deal with AMC is a major achievement for Rogers as AMC has emerged as one of the post popular inventors of the popular TV series and has received high ratings for its shows. 

Currently, there has been a rise in conflict between programmers and cable companies over hike in programming fees. Cable companies like Dish Network Corp (DISH) and DIRECTV (DTV) are persistently defending any significant rise in programming fees as it will have a negative impact on their margins. Moreover, if they manage to pass on the cost hike to its customers, it could in turn increase their subscriber loss.

We believe this is a major success for Rogers as it will not only keep AMC’s popular channels in its portfolio, but will also stop customer churn, which otherwise could have happened had it failed to renew the contract.

Currently, Rogers carries a Zacks Rank #2 (Buy).

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