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FOX AND LIBERTY OUTLINE PLANS FOR NEW CABLE VENTURE
Published November 1, 1995
News Corp., Liberty Media and TCI announced yesterday the formation of a "worldwide alliance to own and operate sports programming services on a global basis." In the U.S., Liberty will contribute its sports networks, including Prime's national and regional outlets and other RSNs. Fox will offer its cable channel, fX, which will be transformed into a national general entertainment and sports network. The RSNs operated under the Prime Sports name will be relaunched under the Fox Sports banner. Internationally, News Corp. and a 50/50 TCI-Liberty partnership will operate currently existing sports services in Asia, Latin America and Australia and new services in the U.K., Japan and New Zealand. News Corp. will contribute various int'l sports rights, including the Asian Star sports channel. Liberty/ TCI is offering Prime Deportiva and other sports and satellite rights. Fox TV Chair & CEO Chase Carey: "In a business that has become increasingly driven by events and worldwide growth, sports represents a force in the media entertainment business second to none." Liberty President & CEO Peter Barton: "This is a commencement of a new era in televised sports." David Hill, who will remain President of Fox Sports, has been named CEO of the new venture. Anne Sweeney will remain fX's CEO. Liberty Sports CEO Ed Frazier and his team will continue to oversee the RSNs (News Corp.). IMAGINE THE POSSIBILITIES: BLOOMBERG notes the deal "is expected to firmly brand the Fox name in the minds of viewers as the premier source of sports on an international basis." Hill notes existing network deals (NHL and NFL) could not be passed to cable (N.Y. POST, 11/1). However, Rudy Martzke reports a "first step" could be MLB, with Liberty expected to pay $43M a year for non-exclusive national rights to Tuesday and Friday nights most likely starting in '98 -- or as early as '96. In exchange for a three-year extension to its national deal, ESPN might allow a partner in regular-season coverage (USA TODAY, 11/1). The WALL STREET JOURNAL notes, "Liberty Sports could promote its games on nationally broadcast pro football, and jointly bid on cable and broadcast rights with Fox" (Robichaux & Jensen, WALL STREET JOURNAL, 11/1). Fox's Carey put the value of the deal at "north of $2 billion" (REUTERS/VARIETY, 11/1). In Atlanta, Prentis Rogers sees Fox "at the center of all the action in sports television" (ATLANTA CONSTITUTION, 11/1). On CNN's "Moneyline," Smith Barney analyst John Reidy said the deal will be "great" for team owners because it could push up the cost of TV rights. But he added, it will be "expensive" for News Corp. and TCI because "the advantage is always with the incumbent" (CNN, 10/31). TIMETABLE: Neither partner could say when fX would begin airing sports programming or what the mix on the channel would be (Sallie Hofmeister, L.A. TIMES, 11/1). RESPONSE FROM BRISTOL: ESPN CEO Steve Bornstein: "Competition is nothing new to us" (USA TODAY, 11/1). One ESPN source told the L.A. TIMES: "They'll try to build using baseball as their leverage. But baseball does not travel well internationally and is no longer the American pastime at home. Murdoch is most interested in the international market, but he'll have a hard time getting local events overseas and at home because rights are sewn up long-term" (Sallie Hofmeister, L.A. TIMES, 11/1). ESPN's Keith Olbermann, after reporting on the Fox-Liberty deal: "In an unrelated development, our area code here has just changed from 203 to 860" ("SportsCenter," ESPN, 10/31).