NEW YORK — Cablevision Systems Corp., the owner of Madison Square Garden and the sixth-largest cable operator in the U.S., has bought Radio City Prods. — the company that operates Radio City Music Hall — for $70 million.
Speaking at a packed news conference bristling with camera crews in the Grand Lounge of the Music Hall on Wednesday, Jim Dolan, CEO of Cablevision Systems, said that Madison Square Garden will run Radio City Music Hall and spend an additional $25 million to restore it.
As part of the deal, Tishman Speyer Properties, which co-owns and manages Rockefeller Center, where the Music Hall is located, has given Cablevision a new lease to the Music Hall for 25 years. One source says the annual rental will be in the $1.5 million range.
Dave Checketts, president and CEO of the Garden, said, “We want to build an electronic arena that will extend the audience for live performers from the 6,000 seats in the Music Hall itself to millions of TV homes throughout the U.S.” Checketts acknowledged that there are some major performers who have turned down offers to appear in the Music Hall because they wouldn’t make money from, say, 10 shows in the theater.
But if the Music Hall could sweeten the offer by adding a TV special to the mix, either on the Cablevision-owned AMC (American Movie Classics) or Bravo cable networks, or as a pay-per-view concert event, those same performers could very well change their mind, Checketts said.
In an interview after the news conference, Dolan said that Cablevision would create “a state-of-the-art electronic facility” in the Music Hall that would become the future home of AMC, which now reaches 67 million households.
Another source says AMC would be able to tape all of its original productions from the studios in the refurbished Music Hall, everything from concerts to interview shows to Bob Dorian’s intros to the movies that dominate AMC’s schedule.
Chris Dixon, a showbiz analyst for Paine Webber, says that Cablevision “now controls about 50% of the total seating capacity for live events in Greater New York,” covering the 20,000 seats in the Madison Square Garden arena, the 6,000 in Radio City Music Hall and the 5,600 or so in the Theater at Madison Square Garden.
“The challenge will be to keep those seats filled throughout the year,” says Dixon. He adds that “it would take a real stretch of the imagination” for MSG and the Music Hall “to expect to create a huge pay-per-view platform” for their concerts. One reason for his pessimism over pay-per-view is “objections from the New York chapters of the unions. New York is a union town.”
Other sources say Cablevision would have to convince the unions that their members would not be jeopardizing their jobs by agreeing to pay-per-view transmission of a show and then finding its number of live performances cut short because potential concertgoers have seen it in their living rooms.
The press conference featured a live appearance by 20 members of the Rockettes precision kicking to the song “New York, New York,” and brief remarks by New York Gov. George Pataki, who praised Cablevision for ponying up $25 million to restore what he called, “the No. 1 theater in America.”
The annual Christmas show featuring the Rockettes is now playing in the Music Hall. But a spokeswoman for the Hall says the theater’s only firm booking for 1998 so far is the Grammy Awards show on Feb. 28, which CBS will telecast. The Music Hall’s bookers were in limbo for a number of months, she says, because Radio City was negotiating its least with Tishman Speyer.
By contrast, the Garden has booked a number of performers for early next year, including the Rolling Stones, Bob Dylan and Van Morrison.