History turns to digital

NEW YORK — History Channel has decided to embrace John Malone’s new digital cable experiment after rejecting a similar Malone-generated service six weeks ago that’s now under way in a cable system in Heath, Texas.

Dan Davids, senior VP and G.M. of History, said the network hadn’t decided on its digital strategy earlier this summer, but concluded recently that “we wanted to get our service on cable systems that don’t have the capacity to carry us on analog channels.”

“I’m glad that History has changed its mind about digital,” said Frank Hughes, VP of programming for the National Cable TV Coop, which represents a number of cable systems. Hughes regards History as a valuable addition to a digital tier that, depending on an individual cable system’s channel capacity, could offer subscribers well over 100 channels, including dozens of pay-per-view and pay TV-multiplex channels.

History’s umbrella deal is with Malone’s HITS (an acronym for Headend in the Sky), which markets a menu of cable channels to systems owned by Malone’s Tele-Communications Inc. and to ones independent of TCI.

TCI sources say HITS first negotiates a deal with a cable system to expand its channel capacity through digital technology, at a total cost, for example, to the Heath, Texas, system of $70,000. Then the system sits down with each cable network in the HITS package and negotiates a system-specific deal.

Ron Martin, executive VP and chief operating officer of Buford Cable, which owns the Heath system, says digital tiers of services are almost certain to harvest more subscribers than analog tiers because analog offers only between four and 12 basic cable networks, many of them not must-buys. “We’ve found these new-product tiers to be a huge disappointment,” says Davids.

By contrast, digital makes available an almost limitless array of channels, which could allow subscribers to select — and pay for — only the networks in which they’re interested.

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