USA announces first major move under Diller

Nets consolidate variety of functions

NEW YORK — Barry Diller has engineered his first major move as head of USA Networks, consolidating the programming, marketing and promotion of the four cable networks in his portfolio: USA, Sci-Fi Channel, Home Shopping Network and America’s Store.

“This is the first big initiative coming out of the new company,” said Doug Holloway, executive VP of distribution and affiliate relations for USA and Sci-Fi, who’ll add Home Shopping and America’s Store to his responsibilities.

Holloway said that what will set the four USA Networks apart from such cable-network powerhouses as Time Warner/Turner, Viacom/MTV and Disney is that “we’re both entertainment and transaction oriented.”

“There are some real opportunities here to drive the cable-operator business in ways no one has explored before,” he continued.

One example USA gives is Paramount’s “Star Trek.” The original “Star Trek” series with William Shatner and Leonard Nimoy begins exclusively on the Sci-Fi Channel this fall. Concurrently, USA plans to run a marathon of the first half-dozen “Star Trek” theatrical movies, banking heavily on cross-promotion to boost the ratings of the series and the movies.

As a further tie-in, Home Shopping and America’s Store will blanket its schedules with “Star Trek” T-shirts, coffee mugs, toys and other products.

Holloway said the sports events USA runs also are natural targets for the selling of sports merchandise on the shopping channels. Examples include the 100 hours of coverage of the U.S. Open tennis match, the Westminster Kennel Club dog show and USA’s Tuesday-night boxing matches.

While the constant cross-promotion keep subscribers tuning in to cable and turning away from broadcast TV stations, Holloway said, cable operators will pocket extra revenue from the sale of products on USA’s two Home Shopping channels.

For every sale chalked up within a cable system’s coverage area, the owner of the system collects a percentage of that subscriber purchase.

Holloway said that while the cable operator will benefit from these marketing plans, the linkage could help ramp up the subscriber count of the Sci-Fi Channel, which now reaches 47 million households (compared with USA’s 72 million), and of America’s Store, which is available to only 11 million cable households (compared with Home Shopping’s 70 million).

Cable operators will start getting the “Star Trek” promotional package over the next six to eight weeks.

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