|WARNER MEDIA, LLC filed this Form 10-Q on 08/02/2017|
TIME WARNER INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
Accounting for Collaborative Arrangements
The Companys collaborative arrangements primarily relate to arrangements entered into with third parties to jointly finance and distribute theatrical productions and an arrangement entered into with CBS Broadcasting, Inc. (CBS) and The National Collegiate Athletic Association (the NCAA).
For the Companys collaborative arrangements entered into with third parties to jointly finance and distribute theatrical productions, net participation costs of $43 million and $45 million were recorded in Costs of revenues for the three months ended June 30, 2017 and 2016, respectively, and $136 million and $118 million were recorded in Costs of revenues for the six months ended June 30, 2017 and 2016, respectively.
The arrangement among Turner, CBS and the NCAA provides Turner and CBS with rights to the NCAA Division I Mens Basketball Championship Tournament (the NCAA Tournament) in the United States and its territories and possessions through 2032. The aggregate rights fee, production costs, advertising revenues and sponsorship revenues related to the NCAA Tournament and related programming are shared by Turner and CBS. However, if the amount paid for the rights fee and production costs, in any given year, exceeds advertising and sponsorship revenues for that year, CBS share of such shortfall is limited to specified annual amounts, ranging from approximately $30 million to $45 million.