What Cablevision Deal for Newsday Could Mean for Local Ad Market

With the Dolan family unexpectedly outbidding Rupert Murdoch for Newsday — to the tune of $650 million — the resulting company will quickly become a dominant force in the New York local advertising market.

By snatching up the Long Island media company, Cablevision — which is led by founder and chairman Charles Dolan and president and CEO James Dolan — gains access to several million new eyeballs each week, whether online or in print. While spokesmen for both companies declined to comment on the possible merger at this point, statements from both companies made it clear that the deal was driven in large part by the opportunity to dominate the local advertising scene and greatly expand the reach of both companies.

Newsday’s daily print product reaches 1.5 million people a week, and its amNewYork title boasts an average weekday circulation of 335,000. But more important in terms of sheer reach is Newsday Interactive, which includes Newday.com and other local sites such as ExploreLI.com. As a group, Newsday sites reached over 3.2 million monthly unique users with more than 66 million page views. Newsday also includes Star Community Publishing, the Northeast’s largest print shopping group, with a circulation of more than 2.6 million.

Combine that with Cablevision’s assets — which include cable systems that reach over 3 million households in the New York metropolitan area, as well as the recently purchased Sundance Channel and several NY sports franchises — and you have pretty significant reach for advertisers, particularly those focused on local exposure. The increased power for both brands could mean a significant competitive boost in the region.

“Both Cablevision and Newsday are in the content, customer relationship and advertising business, and we see this as a wonderful fit,” said James Dolan in a statement. “Adding Newsday Media Group’s superb assets to Cablevision’s portfolio presents a multitude of opportunities: to provide consumers with additional quality content on multiple platforms; expand advertising opportunities for both entities; and attract a larger audience than either company could on its own.” The deal is expected to close late this summer, according to reports.

Naturally, Cablevision also intends to use Newsday’s reach to help promote its own products and services. Among the opportunities created by the deal that were listed in today’s release were “Promoting Cablevision’s live sports and entertainment assets through Newsday’s publications, particularly amNewYork, with its New York City circulation of more than 300,000.” The release also mentioned the converse possibility: advertising Newsday’s properties through Cablevision holdings.

Cablevision was the unexpected winner in the bidding for Newsday, a contest that seemed all but won by Rupert Murdoch in recent days. The triumph of Cablevision, however, means that one of Long Island’s oldest and most well-known brands is back in the hands of a local owner — something that should certainly sit well with the local marketers the company will now be aggressively courting.