'Walking Dead' is Devouring Our Airwaves

NEW YORK (TheStreet) -- Since 2010, The Walking Dead has been one of the top shows on cable television. Cable company AMC Networks (AMCX) has profited handsomely from the hit zombie-themed show. Now, with a new syndication partnership with AMC, 21st Century Fox (FOXA) is stepping up to share in the wealth.

The post-apocalyptic drama will lead a second life in syndication, walking the earth and terrifying viewers all over again.

The surprise announcement came Wednesday that Fox unit MyNetworkTv has won the syndication rights to The Walking Dead. Episodes will air beginning in the fall, when MyNetworkTV shows two episodes of The Walking Dead on one night a week.

Fox executive Frank Cicha summed it up: "It's not often you get to add the hottest show on the planet to your lineup."

The Walking Dead is no ordinary hit cable show. It's the No. 1-watched television program across all networks, including broadcast television. The show has dominated the coveted advertising market of viewers aged 18 to 49. The most recent episode, airing Sunday, March 16, was watched by 12.9 million viewers. In that audience, 8.1 million viewers were age 18 to 49. In October 2013, the premiere for season 4 became the most-watched episode of the series with 16.1 million viewers, including 10.4 million adults. Through the last 30 episodes, only three have fallen below the 10 million total viewer mark, an impressive feat for a cable TV show.

21st Century Fox is clearly putting a lot of money into its MyNetworkTV. The channel currently airs reruns of shows like Law and Order: SVU, Bones, Law and Order: Criminal Intent, House and Monk. Previously the network has aired Desperate Housewives and WWE Smackdown.

The move by Fox also gives the company another way to capitalize on The Walking Dead. Fox's International Group was one of the early backers of the show and now has rights to air The Walking Dead in nearly every country outside the U.S. Fox has already clearly benefited alongside AMC, as the show gains international popularity.

AMC was spun off from Cablevision (CVC) in 2011. Since then, shares of AMC are up 112%, with much of the rise attributed to The Walking Dead. Shares were up 34% in 2013 and have already jumped 14% in 2014. With the syndication deal and a possible wave of new fans, AMC should see ratings and profits continue to rise over the year. Investors should also keep a watch on AMC's planned spin-off of The Walking Dead set in another town.

Shares of Fox on the other hand are down 7% in 2014, after rising nearly 50% in 2013. The company could be in for a big move if its main Fox channel can continue its strong ratings and MyNetworkTV can gain good ratings and better advertisement rates.

The big question is how much of the graphically violent show will make it through to network television. MyNetworkTV, as one of the main broadcast networks, has to maintain a TV-14 rating. AMC maintains a mature rating on its programming and can get away with showing all the gore and violence it wants.

The question is whether fans will tune in for edited episodes. My guess is yes. Not only will fans tune in to reruns, but the overall fan base for The Walking Dead will continue to grow for AMC before the next season.

At the time of publication, the author held no positions in any of the stocks mentioned.

This article represents the opinion of a contributor and not necessarily that of TheStreet or its editorial staff.

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