NEW YORK — Liberty Media’s Liberty Digital unit has agreed to pony up $225 million in cash and $50 million in stock for a half interest in Sony Pictures Entertainment’s Game Show Network, the new partners said Monday.
John Malone’s Liberty, always on the hunt for hidden value, spotted the potential of turning a niche cable channel into a showcase of interactive TV. After all, there aren’t many other genres where viewers be contestants from home. Interactive games are already a major hit online.
“Games, being what they are, are inherently interactive,” Len Grossi, president of SPE’s Columbia TriStar Television division, told Daily Variety.
The Game Show Network, founded in 1994, has about 29 million U.S. cable and satellite subscribers. In a conference call, execs said the goal is to expand the net’s reach to 50 million-60 million subs and grow internationally as well. The network is expected to break even sometime this year.
“Games represent one of the great potential applications of the digital set-top box and have always been one of the primary categories in which we intended to focus our interactive television initiatives,” said Liberty Digital CEO Lee Masters.
Sony, whose giant electronics division manufactures digital set-top boxes, has a vested interest in digital TV — and Game Show Network seems an ideal place for cable operators and others to showcase it, said Grossi.
Deal could eventually lead the companies to strike an agreement that takes advantage of Sony’s PlayStation videogame console.
Sony and Liberty have worked together before. Both are investors in Spanish-language broadcaster Telemundo and, more recently, in Joe Roth’s new Revolution Studios. Sony has a film output deal with Liberty’s Starz Encore pay TV group.
Liberty has stakes in a number of technology and media companies, and its parent AT&T is a giant telecom and cable TV operator. Together, “we think we can make this a hugely more valuable and more profitable network very quickly,” Masters said.
Grossi said SPE is busy “assembling a powerful array of interactive game and content assets.” It already works with Mixed Signals to create special versions of “Wheel of Fortune” and “Jeopardy!,” in which viewers play along with the show using their cable set-top boxes.
The two gamers are already available as interactive Internet shows on Sony’s popular the Station Web gaming site.
Game Show Network also airs several interactive programs like “Inquizition,” in which viewers play along in real time via telephone or the Internet. The technology is similar to that in the enhanced television version of ABC’s “Who Wants to Be a Millionaire.”
Other offerings on the channel include classic gameshows such as “What’s My Line,” “Beat the Clock” and “Match Game,” plus original fare.
Sony recently set up a new U.S. unit called Sony Broadband Entertainment to seek out strategic investments, foster collaboration and develop partnerships in- and out-of-house between content and technology.
(Marc Graser in Los Angeles contributed to this report.)