The network once billed as “CNBC for Millennials” is said to be considering the potential sale of cable company Altice USA Cheddar News, less than five years after purchasing the company.
Altice USA has hired Goldman Sachs to help it find strategic alternatives for Cheddar News, three people with knowledge of the matter said on condition of anonymity. He cautioned that Altice is still considering its options and may decide against the sale. Representatives for Altice USA and Goldman declined to comment.
The sale would mark a retreat from Altice USA’s big bet on the streaming news company. Altice, which is controlled by French-Israeli billionaire Patrick Drehi, paid $200 million For Cheddar in 2019. The deal was seen as a way to beef up the company’s news division, which also includes the News 12 network. Cheddar had billed itself as the future of financial news, featuring interviews with New York Stock Exchange CEOs, news makers and journalists.
Cheddar doesn’t operate like a traditional cable business. Jon Steinberg, founder of the network and former president of BuzzFeed, made deals to distribute it on various platforms. Among them: Gas Station TV (which, yes, runs at the pump) and MTV’s College Campus Network (which is Cheddar). bought in 2018).
However, some of those agreements are not as profitable as cable distribution deals. Rather than paying cable-TV providers such as Comcast for each viewer of Cheddar, an industry practice known as carriage fees, the channel relies mostly on advertising revenue. It’s a tough business model for media companies competing against tech giants like Meta and TikTok for digital advertising market share. (In fact, Cheddar recently laid off employees,
Shares of Altice USA have declined nearly 70 percent over the past year. The company, which provides broadband services in 22 states, said decline in profit and revenue in the first quarter; News and advertising revenue alone declined by 14 percent. Altice is set to report second-quarter earnings next week.