Azteca deal leaves CBS status up in air

$7.5 mil paid for 10% stake in CNI-Canal 40

MEXICO CITY — News net CBS TeleNoticias is in danger of losing its single biggest Latino market, as its Mexico City carrier, CNI-Canal 40, has signed a deal with No. 2 broadcaster TV Azteca.

Azteca announced last week that it’s taking a 10% stake in UHFer Canal 40, where it will do most of the programming. Canal 40 will only program 2-1/2 hours per day, after 9:30 p.m., and a spokesman said it does not plan to continue with TeleNoticias. Azteca plans to fill the rest of the slate mostly with acquired product, which may or may not include newscasts from the CBS web.

Officials at TeleNoticias could not be reached for comment. Azteca in addition will handle ad sales at Canal 40, and split cash flow 50-50 with owner Javier Moreno Valle. Azteca, which reportedly paid $7.5 million for its stake, will use Canal 40 to tap the ad spending that traditionally has not gone to TV and to build a third national network, CFO Adrian Steckel told Daily Variety.

Canal 40 averages a 1% audience share in this city of 20 million, but Steckel said Azteca will cross-promote it with its Channels 7 and 13.

Deal with Canal 40, which also reaches 1.6 million provincial homes via cable, brings Azteca a step closer to parity with Televisa, which has three national webs and a fourth Mexico City outlet.

The pact comes at a tough time for the 4-year-old TeleNoticias, which is under the gun from CBS boss Mel Karmazin to break even this year.

In June, local reports quoted CBS sources as saying they had long-term plans with Azteca, though no details were provided.

(Andrew Paxman in Miami contributed to this story.)

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