USA Networks has taken an equity stake in c/net: the Computer Network, a startup programming service for computer and videogame users that counts among its backers Paul Allen, the Microsoft founding partner who is investing $500 million in DreamWorks.
The Viacom-MCA joint venture, which owns cable webs USA and the Sci-Fi Channel, is said to have a stake of about 10% in c/net. As part of the partnership, the two cablers will carry c/net programming starting April 1. Eventually, c/net aims to become a stand-alone cable network.
By teaming up with USA, which reaches more than 60 million homes and is the most watched cable network, c/net is hoping to establish its service with viewers and advertisers.
With space-crunched cable operators hard-pressed to add new services, an alliance with USA and Sci-Fi will allow c/net to get its programming the
“It’s an unorthodox path necessary because of tight capacity,” said Halsey Minor, chairman and CEO of c/net. “Instead of launching a lot of programming to a small audience, we’re trying to do high-quality programming to a large audience.”
Minor said c/net has the resources and advertiser support to go full-service now, but the limited space on most cable systems makes nesting with USA Networks a more viable strategy
“From an organizational and programming point of view, we will move extremely quickly,” Minor said, adding that c/net has already sold out its advertiser inventory on its first series, “c/net central.” C/net will retain all ad revenue as part of its agreement with USA Networks.
The alliance allows USA Networks to get a stake in what could be a successful net. Also, USA will be able to use its leverage with cable operators to help launch c/net as a standalone service down the road.
The so-called nesting launch of c/net on USA includes six weekly airings of “c/net central,” which is described as an “Entertainment Tonight” for computer and videogame users. The show will run on USA at 7 p.m. April 4.
“C/net central” will run on the Sci-Fi Channel Sundays at 10:30 a.m., 10:30 p.m. and 2:30 a.m.
To make room for c/net programming, USA will drop mostly infomercials and a cartoon block.
“We get an extremely well-produced half-hour magazine show about the changing world of online and interactivity that is on the cutting edge, by people who understand TV,” said Rod Perth, president of USA Networks Entertainment, who added that the programming will fit especially well with Sci- Fi’s audience.
C/net is working to develop new programs for premiere by late summer, said Kevin Wendle, president of c/net Television. Wendle, who has had stints as executive vice president at Fox Entertainment and president/chief operating officer of Quincy Jones Entertainment Co., said c/net will spend lots of money on programming. “The only limit is the number of hours on the network,” Wendle said.
USA Networks has an order for 40 episodes of “c/net central” and a right to review all shows offered by c/net. USA also will have a seat on the c/net board that will be held by either chairman/CEO Kay Koplovitz or Perth.
Other programming may come from Allen, who has a stake in Storyopolis, producer of TV shows with a multimedia tilt for children.
Allen’s investment in c/net is said to be in the multimillion-dollar range, and his investment company, Vulcan Ventures Inc., has two seats on the c/net board.
C/net also is launching an online service in June that it hopes will become a source for consumers looking for computer and digital technology news. The online service will be tied to its TV programming.