CHICAGO, Jul 02, 2008 (BUSINESS WIRE) -- Fitch Ratings has affirmed the 'B+' Issuer Default Rating (IDR)
assigned to Cablevision Systems Corporation (CVC) and its wholly owned
subsidiary CSC Holdings, Inc. (CSC) and has revised its Rating Outlook
to Stable from Negative. In addition, Fitch has affirmed specific
issue ratings and recovery ratings assigned to CVC and CSC as outlined
below. Approximately $11.6 billion of debt as of March 31, 2008 is
affected by Fitch's action.

Fitch's rating action was precipitated by a series of
acquisitions, investments and financing transactions announced by CVC
including the acquisition of Sundance Channel LLC, acquiring a 97%
interest in Newsday LLC, and incremental capital investments related
to the construction of a wireless data network and the renovation of
Madison Square Garden.

With the acquisition of Newsday, CVC capitalizes on the relatively
unique opportunity to purchase a newspaper whose circulation is within
its cable service territory. The Newsday acquisition positions CVC to
grow its advertising business by adding a print advertising platform
to its business model, which provides opportunities to create revenue
synergies by cross selling print, television, and online advertising
to its local advertiser base. Moreover integrating more local content
(news - special features) can further distinguish Cablevision's
service offering from its competition. However Fitch continues to be
concerned with secular issues within the Newspaper sector namely
declining circulation trends and negative pricing environment of
newspaper advertising brought on by the continuing migration of
readers and advertisers to online sources. Fitch believes that
stabilizing the operating trends at Newsday and realizing meaningful
synergies with CVC's existing business may prove difficult and the
incremental free cash flow generation prospect is limited.

The capital requirement associated with the WI - FI mesh network
and the renovation of Madison Square Garden is expected to be
approximately $850 million and will certainly pressure near term free
cash flow generation. From Fitch's perspective the WI - FI service is
a defensive strategy aimed at retaining customers in light of
increasing competitive pressures principally from Verizon
Communications, Inc. The WI - FI network will be capable of producing
speeds of up to 1.5 Mbps, which is comparable to current wireless data
network speeds, however the service will have limited applications
primarily due to the lack of mobility.

Fitch believes event risk surrounding CVC's acquisition and
investment strategy, as well as its financial policies related to the
allocation of capital to CVC shareholders is expected to remain a key
rating consideration as CVC's management is on record stating that the
company will continue to explore ways to increase and retain
shareholder value through acquisitions and or shareholder friendly
activities. However, the Stable Rating Outlook reflects the overall
strengthening of CVC's credit profile as consolidated leverage has
improved from approximately 7.4 times (x) (after payment of a special
dividend) to approximately 5.5x as of the LTM period ended Mar. 31,
2008. In Fitch's opinion CVC's credit profile has sufficient financial
flexibility relative to the current rating category to potentially
accommodate such strategies and management decisions in a credit
neutral manner. Fitch points out that from an operational perspective,
CVC's cable segment ranks amongst the highest in the industry and is
expected to drive further improvement in CVC's credit profile.

Overall, Fitch's ratings for CVC continue to reflect the company's
strong competitive position and the operating and cost efficiencies
derived from CVC's tightly clustered subscriber base, as well as the
company's growing revenue diversity owing to the success of CVC's
triple play service offering. Fitch does expect, however that revenue
generating unit (RGU) growth rates will decline, as growth prospects
within the company's traditional triple play service offering diminish
due to industry leading service penetration rates.

Outside of the risks related to the company's financial and
investment strategies, ratings concerns center on CVC's ability to
maintain its relative competitive position given the changing
competitive and economic environment, growing retail revenues beyond
its core "Triple Play" service offering, and the company's high
leverage profile relative to its peer group. Fitch expects competitive
pressures to escalate as Verizon Communications, Inc. application to
provide video service to all five boroughs of the city has received
approval from New York City's Franchise and Concession Review
Committee.

In addition the refinancing risk attributable to CVC's credit
profile is elevated as approximately $2.3 billion of debt (including
scheduled amortization from bank facilities) is scheduled to mature
before year end 2009. CVC maintains bank facilities at CSC Holdings
for the restricted group and at Rainbow National Services within the
unrestricted group. However Fitch believes that available liquidity
from the respective revolvers coupled with free cash flow generation
may not be sufficient to meet scheduled debt repayment obligations.
Fitch notes that this risk is mitigated somewhat by the company's
historical strong access to capital and bank markets.

Factors that would lead to an upgrade of CVC's IDR include further
strengthening of the company's credit profile and continued
demonstration that the company's operating profile will not materially
decline during the near term in the face of competition and slowing
economic conditions. Moreover, key considerations also include
accommodating non core acquisitions, and investments in a credit
neutral manner, the absence of other leveraging transactions, and
meaningful progress on refinancing near term scheduled maturities.

Fitch has affirmed the following ratings for CVC:

--IDR 'B+';

--Sr. Unsecured Debt 'CCC+/RR6'

Fitch has affirmed the following ratings for CSC:

--IDR 'B+';

--CSC Sr. Secured Bank Facility - 'BB/RR1';

--Sr. Unsecured Debt 'BB-/RR3'.

The Rating Outlook is revised to Stable from Negative.

Fitch's rating definitions and the terms of use of such ratings
are available on the agency's public site, www.fitchratings.com.
Published ratings, criteria and methodologies are available from this
site, at all times. Fitch's code of conduct, confidentiality,
conflicts of interest, affiliate firewall, compliance and other
relevant policies and procedures are also available from the 'Code of
Conduct' section of this site. The issuer did not participate in the
rating process other than through the medium of its public disclosure.

SOURCE: Fitch Ratings

Fitch Ratings, Chicago
David Peterson, +1-312-368-3177
Michael Weaver, +1-312-368-3156
Brian Bertsch, +1-212-908-0549
(Media Relations, New York)

Copyright Business Wire 2008