SBD/25/Sports Media

TURNER-TIME WARNER EXCHANGE "I DO'S" -- NOW WHAT?

     Time Warner Chair Gerald Levin and Turner Broadcasting Chair
Ted Turner made official Friday Time Warner's $7.5B purchase of
TBS, although their announcement was met with protest from Time
Warner shareholder US West and the threat of a lawsuit from
Comcast and Continental Cablevision, both on the Turner board.
The two cable companies disagreed with the package given TCI
Chair John Malone, whose Liberty Media held a 21% stake in TBS.
Under the deal, TCI's cable systems will receive Turner
programming at discounted prices, and TCI gets the option to buy
Turner's SportSouth for $60M and Time Warner's Sunshine Network
for $14M.  In addition, Time Warner has agreed to issue 5 million
common shares to TCI in exchange for the option to buy Southern
Satellite, which distributes Turner's WTBS to cable operators
(Shapiro & Robichaux, WALL STREET JOURNAL, 9/25).
     POSSIBLE TIE-INS:  The possible "synergies" between TBS and
Time Warner are examined at length by several media outlets,
although representatives of the two companies were reluctant to
get into specifics.  USA TODAY notes that a cable channel based
on Sports Illustrated is on the "drawing board" (Alan Bash, USA
TODAY, 9/25).  Also noted, possible book or magazine tie-ins with
Turner's teams -- the MLB Braves and the NBA Hawks (AP/BOSTON
GLOBE, 9/23).
     "SMARTER THAN A TREE FULL OF OWLS":  That's Ted Turner's
description of John Malone, who appears ready to assume a larger
role in the cable sports world in the wake of the merger.  The
N.Y. POST notes that Liberty Media plans to build its string of
RSNs into a "competitor for ESPN worldwide" (John Durie, N.Y.
POST, 9/23).  BLOOMBERG BUSINESS NEWS also notes the SportSouth
and Sunshine deals were aimed at "furthering TCI's goal to piece
together a national cable sports network to rival ESPN (NEWSDAY,
9/24).  USA TODAY's Kevin Maney notes that Malone has two "major
pushes planned":  developing programming through Barry Diller and
his Silver King acquisition, and building a "cable sports
empire."  Maney reports, "Malone says TCI might do more to add
clout in sports programming but did not mention specifics" (USA
TODAY, 9/25).
     BRAVES OFF TBS?  WTBS, Turner's superstation, will likely be
transformed to a basic cable network under Time Warner.  Under
the current set-up, TBS is offered to cable operators for nothing
by Southern Satellite.  Switching to basic means TBS can add
subscriber revenue to its ad revenue bases, but it could also
mean that Braves coverage would have to be dropped (Chuck Ross,
INSIDE MEDIA ONLINE, 9/25).
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