FAST TRACK
By BroadCasting & Cable Staff -- Broadcasting & Cable, 4/10/2005 8:00:00 PM
Time Warner Closes in on Adelphia Deal
Despite a surprise bid by Cablevision Systemsat the last minute, cable giants Time Warner Cable and Comcast were moving closer to winning the auction for Adelphia Communications.
On Friday, the operators were finalizing an agreement to buy Adelphia's cable systems for $18 billion. Adelphia creditors would get $13 billion in cash and stock that Time Warner values at $5 billion. That's $400 million more than Time Warner's initial bid.
The stock would be composed of the new company combining Adelphia systems with Time Warner Cable.
Comcast, which currently owns 21% of Time Warner Cable, would exit, taking systems serving around 2 million with it. Adelphia's creditors could elect to sell their stock or bet that it will rise.
Cablevision surprised Wall Street last week by submitting a $16.5 billion all-cash bid, about $1 billion less. Cablevision is betting that Adelphia's creditors would prefer cash to Time Warner Cable stock, which might not turn out to be worth as much as purported. The bid flies in the face of Cablevision's concentration on the metro New York market since selling all of its other systems in the late 1990s.
Since Adelphia has filed for protection under Chapter 11 bankruptcy code, the companies face several hurdles to get the deal closed, including final approval by all creditors committees and a judge, which could take months.—J.M.H.
Voom Goes Boom
Cablevision will shut down its ailing satellite service Voom April 30. The company's board of directors voted April 7 to disband Cablevision's Rainbow DBS unit, which runs Voom. Cablevision will maintain the 21 high-definition channels it created for Voom and try to market them to other cable and satellite companies.
The Voom shutdown is the final chapter in a boardroom drama between Cablevision Chairman Chuck Dolan and his son Jim, the company's CEO. Chuck Dolan has been a passionate supporter of the service, a sentiment not shared by his son and some other board members. Voom already burned through more than $650 million in cash and would have needed more than $1 billion to become a viable success, troubling analysts and investors.
But Chuck Dolan, in a bid to save the service, used his voting power to oust three directors and install four new members to the 15-person board. It proved just a temporary fix. On March 8, Cablevision agreed to give Chuck Dolan until March 31 to raise funds to buy Voom. The company had already agreed to sell the Voom satellite assets to EchoStar Communications, which operates DBS competitor Dish Network, for $200 million.—A.R.
Gore's Current Affair
Ex-Vice President Al Gore finally unveiled his new cable network, christening it Current. The startup—launching Aug. 1—is envisioned as a home for short-form documentaries, many of them contributed by viewers, using an “iPod Shuffle” model of 15-second to 5-minute clips aimed at young audiences. Gore and his partner, legal services guru Joel Hyatt, recognized the challenge of carriage as an independent channel. “Yes we're outsiders to the television business, but we're not a couple of rubes,” Hyatt says.
Veteran Reporter To Join 'B&C' in L.A.
Jim Benson has been named B&C's Los Angeles bureau chief, effective April 18.
In one sense, it's a homecoming. Benson worked for Broadcasting & Cable [then known as Broadcasting] from 1986-88. He departed for Los Angeles Daily News, where he was the TV columnist. In 1990, he signed on at Variety, where he earned a reputation as a television reporter who knows how to break news. Benson left Variety in 1996 to join Universal Television Distribution where he was senior VP, worldwide communications, for nine years.
“I'm pleased to welcome Jim back to B&C,” says Editor in Chief J. Max Robins. “Working with him for six years back in the '90s when we were both at Variety, I saw up close what a first-rate journalist he is and know first-hand what incredible breadth and depth of knowledge about the TV industry that he brings to our team.”
Adds Group Publisher Chuck Bolkcom, “I couldn't be more excited about Jim's joining us. Bringing such a savvy veteran aboard underlines our commitment to expanding B&C's coverage of the Los Angeles television community.”
FTC Won't Oversee Ratings
The Federal Trade Commission has told Congress that it is not in the business of overseeing the accuracy of media ratings, noting that self-regulation appears to be working.
The FTC concluded that Nielsen did not misrepresent its local people meters (LPMs) or fail to disclose "material facts" about the system. Nielsen praised the decision and said it should end the discussion of whether there should be government oversight of the ratings system. The statement came in a letter from FTC Chairman Deborah Platt Majoras to several legislators, including Sen. Conrad Burns (R-Mont.), who wrote the agency to ask what authority it had over Nielsen. Burns wasn't happy with the response.
His query came in response to criticism that the new meters, which Nielsen is rolling out in major markets, undercount minorities. Nielsen has conceded some sampling problems, which it is working to correct in cooperation with the self-regulatory ratings oversight body, the Media Ratings Council. But it also says the meters are more accurately tracking the flight of viewers to cable and elsewhere.
Fox, which has lost viewers in the new counting method, has backed a group, the Don't Count Us Out Coalition, to push Washington to step in. Burns even held hearings on the meters last year.
Majoras said it was not up to the commission to judge "whether the LPM or alternate systems now in use—which have shortcomings as well—come closer to the actual truth of audience viewing behavior but that, "absent unfair or deceptive practices," it is not the FTC's business to impose standards of accuracy on media-ratings measurement.
Nonetheless, Burns said he would not hesitate to introduce legislation giving the FTC that authority "should the evidence indicate that it would be in the public interest to do so."—J.E.
Taricani Gets Early Release
WJAR Providence, R.I., investigative reporter Jim Taricani, who was convicted in December of criminal contempt for refusing to reveal a source and sentenced to six months of home confinement, was scheduled to be released April 9, two months early.
Taricani, 55, was found guilty after a three-year investigation into his refusal to identify a source who gave him an FBI videotape showing corruption in Providence's local government. He is expected to return to WJAR in coming weeks. Throughout the ordeal, the NBC-owned station has paid his legal bills and salary.—A.R.
Stevens: Not Convinced On Parental Controls
Sen. Ted Stevens (R-Alaska) says he is “not convinced” that parental control of cable content is a sufficient safeguard but he has not made any decisions.
According to his staff, that was the senator's response following his visit with the cable industry at the National Show in San Francisco, where he got a “very good explanation” of parental channel blocking controls. “At this point, he is not convinced yet that this is the total answer but believes the cable industry is certainly working to try to find an answer,” his office said in a statement.—J.E.
ABC Picks Up Four Shows for Fall
ABC has re-signed four dramas for next season: hit freshmen Desperate Housewives and Lost, plus solid performers Boston Legal (another freshman) and veteran Alias (now in its fourth year).
Housewives and Lost are effectively no-brainers in the pick-up department. They are the network's biggest hits—Housewives is the season's biggest new hit, period—while Practice spinoff Boston Legal has been No. 1 in its Sunday 10 p.m. time period, helped by the audience delivered by Housewives, although new drama Grey's Anatomy has been scoring even bigger numbers in its two outings.
If medical show Grey continues in that same vein, look for it to get an early pickup as well.—J.E.
Discovery Asks or More Upfront
Discovery Networks is looking for boosts in ad rates—despite flagging ratings—based on optimism that its new shows will help reverse the ratings downtrend at a number of its networks.
Discovery Networks President of Advertising Sales Joe Abruzzese told reporters at the upfront presentation that he expected cable ad rates overall would be up 6%-7% in this year's upfront and predicted ad growth for his own networks despite the fact that several are flagging in the ratings. “We're looking for growth in rates, growth in pricing and growth in value,” he said.
He may have a hard time convincing ad buyers. In first quarter 2005, Discovery Channel was down 26% in prime time ratings, according to Nielsen. TLC was down 34%, and Animal Planet was down 12%. One bright spot in Discovery's portfolio in the first quarter was Discovery Health, up 43%.
TLC led the presentation with several new reality shows including a home-construction show, The Adam Corolla Project, hosted by the comedian (who worked in construction before comedy), Going Hollywood about a team of L.A. interns, and The Sit Down, in which mob bosses serve as judge and jury to average neighbors and small businessmen with “issues.”—A.B.
Q TV Gets Hit of Oxygen
Here!, the most widely distributed gay-TV programmer, says it has signed deals for Comcast and Cox to carry its programming on-demand that will boost Here!'s reach to 40 million households. (At last count, the pay-TV service was claiming 30 million).
Meanwhile, fledgling Q Television is buying its route to visibility. The tiny pay network signed a six-month deal with Oxygen to run its show Q on the Move from 5:30 to 6 a.m. daily, starting April 14.
That will boost QTV's reach from several thousand paid customers (who get it via RCN) to the more than 53 million households that receive Oxygen.—J.F.
Mandabach Launches Brit-Com Biz
Caryn Mandabach, formerly of Carsey-Werner, is launching a U.K.-based company, Caryn Mandabach Productions, to handle a new comedy-development-production deal with the British Broadcasting Corp.
BBC is putting up the money for Mandabach to develop five comedy scripts in association with the BBC's Head of Comedy Commissioning Mark Freeland who says Mandabach has “a nose for mainstream hits.”
Mandabach, whose nose led her to such sitcom classics as The Cosby Show, Roseanne, and 3rd Rock From the Sun while at Carsey-Werner, already has one script in the works with Simon Nye (Men Behaving Badly). Mandabach, who had spent two decades with the distributor first as producer and eventually as partner, exited Carsey-Werner last August.—J.E.
USA Pins Down WWE Pact
Pro-wrestling fan sites were abuzz Tuesday with the news that NBC Universal had struck a three-year deal to bring World Wrestling Entertainment Inc. programming back to USA Network starting in October.
In addition to the return of Monday Night Raw, which debuted on USA back in 1993, USA will air a one-hour weekend version of RAW, with co-owned Telemundo airing Spanish-language versions. As B&C reported April 4, NBC U has been sweetening the deal—including a tie-in to co-owned Universal theme parks—to wrestle wrestling away from Spike TV, which itself grabbed the rights from USA in 2000.—J.E.
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