Question-and-Answer Session
Operator
(Operator Instructions) Your first question comes from the line of Imran Khan – JPMorgan
Imran Khan – JPMorgan
Good quarter, two questions about the sustainability of a couple of line items, so in terms of the programming costs you talked about. Programming costs grew 4% on an adjusted basis, as we get out of the recession how should we think about the programming cost growth next year, do we see the cost will increase at a faster pace and secondly you talked about affiliate fees increasing 80% in the domestic affiliate fee growth came from the pricing increase, how sustainable is that pricing improvement when do we start seeing lapping those price increases.
Philippe Dauman
As far as programming costs we have been able to keep the programming cost growth in the low single-digits. We would aim to maintain programming cost growth at the low to mid single-digit level. We are looking at those costs across the entirety of our portfolio. We adjust our spending depending on where the needs are.
There are transitions that take place in various networks as licensed programming comes off for example and we replace it with original programming. So we try to manage it across our portfolio and making sure that we grow the programming costs in accordance with the revenue opportunities for our networks and where the needs are.
As far as affiliate fees, as I mentioned in my remarks, we provide great value to our distributors and we are happy to provide great value to them. But we believe we continue to have room to grow from low affiliate fee base to reflect the investment that we are making in programming and in other ways in our brands. Our programming tends to over index in other products that our distributors roll out to their customers such as video on demand and as well as online and other offerings that they put out.
So we believe that the, and we are targeting continued growth in our affiliate fee rates and continue to work with our customers to maintain that.
Operator
Your next question comes from the line of Michael Nathanson – Sanford Bernstein
Michael Nathanson – Sanford Bernstein
I have two, I think in your opening remarks you said that Rock Band business was improving but not as quickly as you would like it, so can you tell us what disappointed you about the pace of improvement and what should look forward to in the next couple quarters that we can do about it.
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