Weinsteins Seek Pulp FusionFilm heavyweights negotiating for cable network Fuse 8/26/2005 08:00:00 PM Eastern
Ex-Miramax Pictures chiefs Harvey and Bob Weinstein may finally reach their goal of getting into the cable-TV business, and they’re doing it through an improbable route: by attempting to buy music-video network Fuse.
The brothers are in talks with Cablevision Systems about transforming Fuse into a platform for their startup company’s movie and entertainment products, industry executives familiar with the talks say. They envision the channel as a mix of “lifestyle” shows and movies, aimed more broadly than the 18-34 demographic Fuse targets.
Cablevision is already a backer in Weinstein Co., the production company the brothers launched after their divorce from Miramax owner Walt Disney Co. in March.
The deal would not carry a giant price, probably around $450 million. But it would mark the end of the Weinsteins’ long pursuit of cable-network ownership. At Miramax, they tried to buy into Cablevision’s Independent Film Channel and Bravo. In 2002, they attempted to create The Miramax Channel, a movie channel that never got off the ground.
Under the Weinsteins, Fuse would not likely face off with MTV, still the dominant music network even as it has drifted to reality TV. Industry executives say that the Weinsteins see Fuse as a “tear-down” and are more interested in the network’s 38 million basic subscribers than in its strategy of “More Music. Less Crappy TV,” as its slogan goes.
LOWEST-RATED NETWORK ON BASIC CABLE
Wall Street assigns no particular value to Fuse’s programming, as Fuse has sat firmly at the bottom of the Nielsen rankings for years.
Launched in 1995 as MuchMusic USA, an offshoot of a Canadian music channel, Fuse is the lowest-rated of the 60 basic-cable networks that are tracked by Nielsen. In a recent week, it averaged a minuscule 37,000 viewers in prime time. That’s 40% fewer than even the next-weakest channel, ESPN Classic. Analysts price Fuse at pretty much the value of its real estate on cable systems.
Spokesmen for both Cablevision and the Weinsteins would not comment on the talks, which come as the brothers are starting to raise money for their new company. Weinstein Co. will try to re-create Miramax’s blend of smaller, offbeat movies and broader films in specific genres. (Miramax’s Dimension unit specialized in horror.) The Weinstein brothers formally started pitching investors just this month, asking them to put up $350 million to $500 million in equity. They plan to borrow another $500 million.
The son of the company’s founder, Chuck Dolan, Cablevision CEO James Dolan is seen to be particularly dazzled by the lights of Hollywood. As founder of IFC and an accompanying film- distribution unit, Cablevision has already been a substantial player in Miramax’s turf of artsy movies.
Cable networks are stepchildren in the Cablevision portfolio, tossed around as financial chips to suit the Dolans’ needs. In the past three years, The company has planned to spin off its Rainbow Media unit before pulling it back, sold Bravo to NBC to alleviate a financial crisis, and tied the networks to money-burning startup Voom so the now-failed DBS venture could get bank loans.
Finally, the Dolans are proposing to take Cablevision private, but want only the company’s cable systems. They want to cast the networks off to shareholders to minimize their spending on the deal.