Fox Makes Deal Impacting TV Landscape
FOX Broadcasting Co. hopes to reshape the television landscape with a $500 million deal to pry loose 12 stations from the three major United States networks.
New World Communications Group Inc., a TV production company, says it had agreed to switch five of its stations, and seven others it will buy in the next year, over to Fox. In return, Fox will buy 20 percent of New World for $500 million.
Eight of the stations are CBS affiliates, three are with ABC, and one is with NBC. All 12 stations are on the high-powered VHF frequency; most are in key markets such as Detroit, Cleveland, Dallas, and Atlanta.
VHF stations, which broadcast on Channels 2 through 13, usually earn more advertising revenue than UHF stations because they reach bigger audiences and get better ratings.
Fox Chairman Rupert Murdoch called it the biggest network realignment in 60 years of American television.
``This agreement will forever change the competitive landscape of network television,'' he said in a statement. ``This is a giant step toward leveling the playing field and toward the longstanding public-policy goal of achieving a fully competitive fourth broadcasting network.''
Fox has about 150 full-time affiliates, compared with more than 200 each for CBS, ABC, and NBC.
The Fox network was launched seven years ago in an effort to compete with the older networks by gearing prime-time shows to younger viewers.
Fox stunned CBS in December by agreeing to pay $1.6 billion over four years for the broadcast rights to National Football League games. CBS had been carrying the games for 38 years.
CBS said in a statement it was ``confident in the continued strength of our network and in the value of CBS affiliates. We will maintain strong affiliations in all of the markets affected.''
New World, which produced the TV series ``The Wonder Years'' and ``Santa Barbara,'' is controlled by financier Ronald Perelman's MacAndrews and Forbes Holdings. It has committed about $2 billion over the past year to assembling a TV-station group and has been looking for a steady outlet for its programs.