NEW YORK — Ted Turner is once again confounding the skeptics who said he’d be hard pressed to induce a batch of major cable operators such as Cox, Jones Intercable and Falcon to cast off their misgivings and start paying a license fee to the TBS network for the first time.
Bill Burke, president of TBS, says that an extraordinarily bullish advertising marketplace was a big reason why the network was able to cajole these cable operators into paying for TBS. While cable systems will be shipping truckloads of money to TBS every month starting Jan. 1, “the operators will also be getting access to advertising revenues locally for the first time” as the network sets aside two minutes an hour throughout its entire programming schedule, Burke said.
Local sales executives for cable systems, he continued, should be able to harvest lots of extra money from the local time in the 100 or so Atlanta Braves baseball games TBS covers every year, the National Basketball Assn. playoffs and regular-season games, and broadcast premieres of theatrical movies such as “The American President” and “Mortal Kombat,” among other TBS offerings.
If the ad market continues to boom in 1998, cable operators could earn back the monthly fee of 25¢ a subscriber they’ll be paying, a tariff that goes up 2¢ a year, topping out at 33¢ in year five. So a 1 million-subscriber multisystem cable operator would pony up a total of $3 million in the first year, $3.24 million in year two, $3.48 million in year three, $3.72 million in year four and $3.96 million in the fifth and final year of the contract.
Some top-10 operators are still not on board yet, such as Media One (formerly Continental), Comcast and Cablevision Systems. Various sources said that even though these operators are likely to fall in line before Jan. 1, the TBS negotiations have forced them to re-evaluate the concept of general-entertainment networks that schedule programs like movies, TV series and sports, which are available on the broadcast networks, TV stations, pay TV networks and pay-per-view channels.
At least in their answers to survey questionnaires, cable subscribers tend to profess the greatest degree of loyalty to networks that differentiate themselves from the herd, such as Discovery Channel, History Channel, MTV, CNBC and Learning Channel, said one cable operator who’s balking at TBS’ license fees.
But this operator acknowledged that, except for Discovery, none of these channels show up among the top-10-rated networks in the weekly Nielsen rankings. TBS’ consistently strong ratings in the cable universe make it almost impossible for an operator to remove it without incurring mass protest from subscribers, resulting in a public-relations horror show.
And Burke pointed out that TBS moves quickly to rejigger its programming when the network’s ratings start to slide. For example, after less than two months on the air, reruns of the poorly performing “Coach” were dropped from TBS’ double-run weeknight schedule at 7:05 and 7:35 and replaced with double runs of the black-and-white “Andy Griffith Show.” Plagued by anorexic ratings, “Coach” was providing almost no audience flow into TBS’ primetime lineup.
In its marketing campaign, Burke said, TBS is positioning “Griffith” as a forerunner of “Seinfeld” in its obsession with the minutiae of everyday life. One promotional clip shows a back-porch conversation between the characters played by Andy Griffith and Don Knotts that strikingly parallels one of the circular discussions that Jerry Seinfeld and Jason Alexander find themselves stumbling into week after week on “Seinfeld.”