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No urge to merge

No Encore likely to MGM's filmmaking future

NEW YORK — Encore Media Group chairman John Sie effectively ruled out the possibility of a merger between the pay movie channel operator and Metro-Goldwyn-Mayer on Wednesday, saying Encore was “absolutely against going into the movie business.”

Sie said Encore, a subsidiary of Liberty Media that operates the Encore and Starz pay movie channels, is keen to do a licensing deal on the Lion’s vast film library, however.

Speaking at an Encore Media news briefing Wednesday morning to discuss new programming and marketing strategies, Sie said his discussions with MGM have centered on signing multiyear license deals to acquire the pay TV rights to MGM’s more than 5,000-title library of theatrical movies.

“We like the MGM library,” Sie said. Encore would be willing to “work out an arrangement” with MGM to get access to that movie library, but not if such a deal would bind Encore and Liberty Media to becoming involved in financing an ongoing slate of theatrical movies.

“I’d rather rent a studio’s movies than own a studio,” Sie said. A license-fee deal for MGM’s library, he added, “would allow us to create five new movie channels.”

Not optimistic

But Encore execs don’t appear optimistic of striking such a deal, believing MGM wants to do a broader deal than simply licensing. MGM has been talking to several cable programmers, including Encore and Cablevision Systems Corp., about a wide-ranging alliance.

MGM CEO Alex Yemenidjian confirmed several weeks ago that these talks could lead to a merger. But Sie said he and Liberty chairman John Malone are not interested in such a deal.

Calling movie production “a roller-coaster ride” that’s booby-trapped with “economic risks,” Sie said Encore “will continue to work at what we do best, which is to package movies and sell them to our cable customers” through 13 thematic multiplex pay TV channels.

Starz has the first pay TV window for exclusive theatrical movies from Disney’s Touchstone, Hollywood and Miramax Pictures, Universal, Imagine, October Films, New Line and Fine Line, among others, through the company’s output deals with those studios.

(Martin Peers contributed to this report.)