NEW YORK — NBC will sell its stake in Court TV for $70 million, and Time Warner and Liberty Media Corp. will increase their stakes in the cable network to 50%.
Time Warner will take management control of the legal channel (Daily Variety, May 21), the media conglomerate announced Tuesday. NBC, which will sell its interest in two stages, will have rights to acquire equity in Court TV in the future.
Taking into account NBC’s share of the cable network’s debt, the deal values Court TV in the neighborhood of $300 million.
The agreement finally brings the soap opera that has marked the bickering and machinations of Court TV’s ownership situation to a conclusion. NBC, Time Warner and Liberty have each owned a third of the trial channel, and have disagreed for some time about how the network should be run.
The agreement ends several weeks over which two other companies made bids for the cable channel. Most recently, Discovery Communications offered about $320 million to buy Court TV’s 33 million subscribers with the intention of dropping the channel’s legal programming and substituting one of its fledging programming formats, such as Discovery Health.
Discovery’s bid several weeks ago topped a $300 bid from Evercore Partners and NBC executive Tom Rogers.
Time Warner said it will maintain Court TV’s programming format, but offered no other details about how the new ownership will affect the cable network. Court TV’s 200 employees — who were generally happy with the ownership change — said they were unsure if the network’s headquarters will be moved to Atlanta, the home of Time Warner’s Turner Broadcasting System.
Several sources close to the deal said many decisions regarding Court TV have yet to be made, such as whether the network will be run as a standalone entity or be packaged under Turner’s cable network division, which includes CNN.
Time Warner vice chairman Ted Turner, who founded CNN, has taken a particular interest in Court TV. Turner has voiced concern that Court TV in another company’s hands would represent competition to CNN. For this reason, Turner protested the sale of Court TV to Discovery.
Insiders said Time Warner will continue Court’s TV’s formula of airing live court trials during the day but will attempt to raise ratings in primetime with broader-appeal programming that’s related to the legal process.
“We’ll know they’re really serious about this channel if they put money into primetime programming,” said one insider. “If they say that they’ll deal with it in six months, it’s time to get the resumes out.”
Off-net TV series and movies revolving around the legal system would significantly improve ratings in primetime.
Court TV’s ratings have consistently ranked at the bottom of basic cable network ratings. Court TV’s ratings have jumped during high-profile trials, such as the O.J. Simpson case and the Menendez brothers murders.
The Court TV agreement is a blow to Rogers, executive VP for NBC, who had hoped to become chief executive of the cable network with his bid in conjunction with Evercore Partners. An NBC representative said that Rogers remains a “vital” executive with the company.
NBC will collect its $70 million by January 1999, sources said.