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MICROSOFT IN TALKS WITH NBC, BUT WHAT ABOUT?
Published December 11, 1995
Microsoft Corp. is engaged in "secret talks" with GE about buying up to 49% of NBC, according to a report in DAILY VARIETY. Although officials refused to comment, a source familiar said the talks are "advanced." Microsoft already has a deal with NBC for the use of the network's sports, entertainment and news programming for its online service, and the two companies are in discussions on launching a 24-hour all-news cable channel to compete against CNN (Hofmeister & Helm, L.A. TIMES, 12/11). A 49% stake in NBC "would easily cost" Microsoft $4B (N.Y. POST, 12/11). One Microsoft source "doubts" Chairman Bill Gates would spend that much to "buy half of NBC as a content play" choosing instead to "make a series of deals with programmers." Analysts also doubt Gates will put that much cash into a broadcast network "when he has ambitious plans to reengineer Microsoft to exploit the growth of the internet" (L.A. TIMES, 12/11). The WALL STREET JOURNAL cites sources saying the rumor is "false," but that NBC and Microsoft "are weighing" a $100M investment in the news channel to be split 50/50 (WALL STREET JOURNAL, 12/11). OTHER NETWORK NEWS: Westinghouse announced they will sell some defense business and another division to help pay for its purchase of CBS. One CBS exec said Westinghouse may "start its own cable television network featuring CBS shows as an additional means of generating cash" (Greg Clarkin, N.Y. POST, 12/9). The development of "all-news" channels is featured in the current BUSINESS WEEK (Dreising & Oneal, BUSINESS WEEK, 12/18 issue). Viacom CEO Frank Biondi said a merger between Viacom's UPN and Time Warner's WB Network would be a "great idea," adding that he doesn't know why such a merger "hasn't happened" (CHICAGO TRIBUNE, 12/9).