Premiere pacts with Kabel Deutschland

COLOGNE — Pay web Premiere has signed up with Germany’s largest cable operator, Kabel Deutschland, for distribution and marketing of its programming in the company’s vast cable grid, which covers 60% of the country’s cable households.

Deal is part of Kabel Deutschland’s introduction of digital programming packages, which it is looking to start this spring.

According to Premiere topper Georg Kofler, Kabel Deutschland will receive a commission for wooing customers to subscribe to Premiere. Kabel initially will offer the pay web’s low-priced starters kit, which includes First League soccer games as well as content from MGM and Discovery Channel.

Kofler said he expects digital TV to be available to roughly half of Germany’s households by 2006. “Premiere’s exclusive programming is one of the main reasons people decide for digital TV,” he said.

Premiere has long been the only pay web in Germany, and its linkup with Kabel, which serves 12 million households, will make it harder for potential competitors to break into the market.

A new contender has emerged in Ish, the cable operator of North-Rhine Westphalia, one of three regions not included in Kabel Deutschland’s grid. Ish recently launched a video-on-demand and digital pay TV service with 56 channels, including Universal’s Sci-Fi and 13th Street outlets.

Kabel Deutschland is said to be keen to take over Ish, which is currently for sale by its creditors, including Deutsche Bank and Citigroup, which acquired the company after former owner Callahan went bankrupt in 2002. Move could put Ish and Premiere in direct conflict with Kabel Deutschland.

Kabel Deutschland also reportedly is looking at purchasing the two remaining regional cable operators, Iesy and Kabel BW, although it would face regulatory hurdles in the process. Media authorities have expressed public concern about the possible formation of a new monopoly in the cable market, which was the main reason behind Deutsche Telekom’s sale of its cable holdings in recent years.

Meanwhile, Premiere reportedly is close to inking a three-year output deal with Constantin Film, Germany’s biggest producer-distrib, for such pics as “Resident Evil: Apocalypse,” action-comedy “Autobahn Racer,” Oliver Stone’s historical epic “Alexander” and Tom Tykwer’s big-budget drama “Perfume,” which is set to start shooting in the fall for a 2005 release.

(Ed Meza in Berlin contributed to this report.)

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