Time Warner Cable has agreed to carry News Corp.'s new Fox business channel when the channel launches. The deal was part of a long-term agreement between the two companies that also extended Time Warner's carriage of Fox News Channel and the Speed channel, granted TWC retransmission consent of Fox's owned and operated TV stations in its markets, and provided carriage of the Fox Reality Channel, according to a Time Warner representative.
News Corp. has said it wouldn't launch the business channel - a long-delayed planned spinoff of Fox News - unless it had 30 million subscribers, so Time Warner Cable's 23 million are a big milestone. Time Warner, the nation's second-biggest cable operator, also covers much of New York City, an important area for the network's target audience.
The placeholder deal for the business channel was likely helped by News Corp.'s willingness to settle for digital carriage. In November, the company said it was not demanding that cable operators carry the channel as a basic-cable offering but rather accepting carriage on digital tiers, to which 35%-45% of cable customers subscribe.
On a conference call to announce News Corp.'s quarterly earnings in November, News Corp. COO Peter Chernin declined to set a timetable for the channel's launch but said it had "much greater clout than we had in years past" and "an opportunity to sign up a large number of subs before we launch." He also denied that the company was leveraging rates for its established Fox News Channel to negotiate rates for the business network.
Fox's business channel has been a pet project of News Corp. Chairman Rupert Murdoch, but Fox News Chairman Roger Ailes has been slow to move on it, waiting until he's sure he can line up cable- and satellite-TV distribution. It will draw a limited audience anyway, given its niche appeal of business news. Still, CNBC has proved that, even with low ratings, the focused and affluent audience for business news can generate strong profits.
News Corp. itself has been publicly hesitant about the channel's viability. A recent press release announcing a promotion for radio syndication chief Kevin Magee said he will be the executive in charge of the proposed business channel "in the event distribution is secured for its launch."