Will rock and roll chef Anthony Bourdain come work in the commissary as part of a deal?
That might be what some of the major media conglomerates kicking the tires of Cox Communications Inc.'s Travel Channel are wondering. The auction for the channel, whose biggest show is Bourdain's "No Reservations," is underway and the usual suspects are taking a look. Among those interested in the network are NBC Universal, Scripps Network and News Corp., according to news reports. The price being bandied about is in the neighborhood of $700 million.
That may seem low compared with recent cable network deals such as the $3.5 billion that NBC and private equity firms Bain Capital and Blackstone Group shelled out for the Weather Channel last year and the $925 million that NBC paid for Oxygen in 2007.
Of course, the economy was in better shape then and both those networks are better known than the Travel Channel. Also, the Weather Channel has a strong Internet presence and NBC desperately wanted to combine the network with its own digital weather channel. NBC probably sees the Travel Channel as a good complement to the Weather Channel and even MSNBC.
Scripps is interested in the Travel Channel because it would dovetail with its other lifestyle networks, including the Food Network (in which Los Angeles Times parent Tribune Co. has a stake), Fine Living and Home & Garden.
The Travel Channel has done a nice job of boosting its ratings over the last few years. Its audience is still small, but it's growing. In prime time, the network this year has averaged 485,000 viewers, a 25% gain from 2004. In demographics, it has risen 35% among adults ages 25 to 54 in the last year and its median age is 45, a drop of four years from 2008.
Bourdain's show draws close to 900,000 viewers per episode. The channel's other popular shows include "Man v. Food" and "Bizarre Foods With Andrew Zimmern."
From a business standpoint, there's room for growth. Media consulting firm SNL Kagan said the fees that the Travel Channel charged cable and satellite operators amount to only 6 cents per subscriber per month. For 2009, it is projected to have net operating revenue of $185.8 million, advertising revenue of $128.2 million and cash flow of $69.1 million, according to SNL Kagan.
Cox, which doesn't own any other national cable networks, ended up with the Travel Channel two years ago as part of its deal to sell its stake in Discovery Communications.
When a channel goes on the market, everyone takes a look. What's notable is that Time Warner Inc.'s Turner Broadcasting, which went after the Weather Channel big time, has decided to pass.
But there's still plenty of time for Turner to try to make a reservation with Bourdain.