NEW YORK — Viacom is cloning its paycable networks Showtime, the Movie Channel, Flix and Sundance Channel at almost manic speed, adding eight new multiplex “screens” in the next year to push the total up to 20.
“The premium category is reinventing itself,” says Jeff Wade, executive VP of sales and affiliate marketing for Showtime Networks Inc.
Wade cites the strategic plans of just about all of the multisystem cable operators to dramatically expand their channel capacity through digital technology. “There’ll be lots of demand for premium movies” to fill these new channels, Wade says, “because movies can become drivers of digital tiers.”
Without paycable movie networks as part of the mix, a tier of cable networks may pull in only a small fraction — 10% or below — of the cable system’s subscribers. Wade says preliminary studies by Showtime indicate that a multiplex-pay tier featuring movies galore “could chalk up a penetration rate of between 25% and 30%.”
The potential revenue bonanza for Showtime has induced the company to lay out millions of dollars for these network clones, which need extra transponder space for the uplinking of the multiplexed signals. Although the multiplexing mainly involves time shifting of existing movies and other programs on the various pay networks owned by Viacom, Showtime has to lay out extra bucks to draw up new schedules and fresh marketing tools for cable operators and direct-broadcast-satellite distributors like DirecTV and Primestar.
In movie-theater terms, the plexing of a cable network is analogous to a sixplex playing “Lost World: Jurassic Park” on all six screens, but at different times of the day.
Wade is working with the operators and DBS distribs to “make sure that all of the premium networks like Showtime and HBO are adjacent to each other on the dial” so that channel-surfers who are shelling out extra money each month for the tier will quickly land on a movie that hooks them.
The Showtime plexes include a new Rocky Mountain time zone feed for Showtime on Sept. 1 and for Movie Channel early in 1998. Scheduled for launching in April 1998 is a new Showtime “Action Plex” network, which will encompass separate East and West Coast feeds.
Wade says Showtime may buy and produce additional programming for the Action network because “subscribers always put action at the top of their list when you ask them what type of movies they like best.”