Outlet relaunching late 2010 under new name

HOLLYWOOD — Hasbro is partnering with Discovery Communications, taking a 50% stake in the Discovery Kids cable channel.

The partners plan to enter the kids field, dominated by Nickelodeon, Disney and Turner’s Cartoon Network, in late 2010. As part of the deal, the moribund Discovery Kids network — which has never managed to penetrate the marketplace, despite several attempts — will be renamed and relaunched in almost 60 million homes.

Under the joint venture, Discovery Communications will receive $300 million for the assets related to Discovery Kids Network in the U.S. A board of directors will be formed with equal representation from both sides; Discovery will oversee ad sales, distribution and other operations, while Hasbro will handle studio programming.

On its own, Hasbro plans to invest heavily in launching a production shingle in order to supply shows to the new kids network but also potentially produce series for other outlets — including primetime TV.

“We expect that within a few years, our production budget could be in the range of $100 million annually, depending on ratings and sales and merchandising success,” said Hasbro prexy-CEO Brian Goldner.

Hasbro plans to hire 15-20 staffers to develop fare at its studio and will tap a creative exec who will report directly to Goldner.

Separately, the new jointly run channel is also scouting for a president-g.m. to oversee the operation.

Deal reps the latest move by Discovery under topper David Zaslav to make over its cable nets. Discovery previously formed a 50/50 venture with Oprah Winfrey to turn the Discovery Health Network into the new OWN channel; it also relaunched Discovery Home as Planet Green.

Discovery Kids is the latest prong in Hasbro’s Hollywood strategy. Hasbro — repped by William Morris Agency, which initiated the Discovery deal — earlier pacted with Universal, which has turned its properties into movies such as “G.I. Joe: The Rise of Cobra” and “Transformers: Revenge of the Fallen,” is developing a movie based on the board game Candy Land. It also entered the digital gaming space via a partnership with Electronic Arts.

“As we looked at the options available in TV, Discovery has beachfront real estate,” Goldner said. “We were looking for a partner who understood the cable space, and they were looking for a partner to figure out how to position the network going forward.”

Initial projects Hasbro is targeting for the channel include shows based on “Romper Room,” Tonka, G.I. Joe, Transformers and “My Little Pony.”

Current Discovery Kids fare, such as “Bindi the Jungle Girl,” “Hi-5″ and “Flight 29 Down,” will continue to be included, and the channel will also pick up shows produced by outside parties.

The channel, geared toward kids under 14, will also air educational/ informational content.

Hasbro said it is looking at developing programming based on games such as Scrabble, Cranium and Trivial Pursuit.

“The combined assets of both partners provide a compelling platform for building a trusted children’s destination,” Zaslav said.

As part of the deal, the joint venture will also take a minority interest in Hasbro.com.

The channel will continue to be run as Discovery Kids for now. Discovery will continue to hold rights to the Discovery Kids name for its international networks, as well as licensing and merchandising.

Thursday’s announcement didn’t sit well with at least one special interest group. The Campaign for a Commercial-Free Childhood sent out a release soon afterward, calling the partnership “a new low in children’s television, a network devoted to showing infomercials for Hasbro’s toys and games.”

In response, Goldner said it was “presumptuous and inaccurate to come to any conclusions at this point.”

“We just made the announcement,” he said. “A network is not going to be successful if it’s overly commercialized.”

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