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4Kids buys 4 hours from Fox Kids

Sat. ayem block fetches $25 mil.

Fox Kids has sold Saturday morning kids block to “Pokemon” producer 4Kids Entertainment, which will pony up $25.3 million a year to lease the net’s four-hour ayem time period.

In addition to mega-hit “Pokemon,” 4Kids produces the animated action skeins “Yu-Gi-Oh!” and “Cubix,” both of which air on Kids’ WB.

A heated bidding war between 4Kids and DIC Entertainment helped drive up the price for the daypart to more than three times the $8 million that Discovery Communications agreed to pay NBC last month for its three-hour Saturday ayem block. In addition, by waiting until after the Peacock did its deal, Fox’s real estate became even more valuable to kiddie companies looking to get a guaranteed outlet for their programming.

Industry insiders believe 4Kids won out over DIC because of the former’s proven track record in creating new hit franchises, as well as its extensive relationships with Japanese kidvid suppliers. Since Fox’s stations will still be able to sell local ad time, the network apparently wanted to ensure that whoever landed the block could keep it successful.

As part of the four-year deal, Fox has retained the right to preempt programming in the block several times a year for baseball or other sports.

Nickelodeon, which had been in the running for both NBC’s and Fox’s blocks, bowed out after the bidding reached $15 million.

While 4Kids does TV, film, homevideo and music production, the Gotham-based firm has a heavy focus on licensing. In addition to “Pokemon,” “Yu-Gi-Oh!” and “Cubix,” the publicly traded company also represents Nintendo and Cabbage Patch Kids.

In October, 4Kids signed a five-year pact with Pokemon USA to continue serving as the exclusive licensing agent and rep of TV broadcast and homevideo rights to “Pokemon” outside Asia. In addition, 4Kids acquired a 3% interest in the Pokemon Co.

The “Pokemon” franchise has grossed more than $10 billion worldwide since its introduction.

Because 4Kids produces action-packed animation series that doesn’t fulfill the FCC’s educational requirements for kids, it’s possible that they’ll sublet out an hour of the block to another tot programmer. The other three hours can consist of commercial programming.

Since “Pokemon,” “Yu-Gi-Oh!” and “Cubix” air on Kids’ WB, it’s unclear what programming 4Kids plans to air on Fox. Company will be shopping new animated properties “Kinnikuman,” “Ultraman Tiga” and “Tama and Friends” at NATPE this week.

Fox’s Saturday ayem ratings have slipped in recent years as the net lost viewers to Kids’ WB, Nickelodeon and Cartoon Network. Once News Corp. sold off Fox Family to Disney and returned its afternoon block of programming to affiliates, Fox — without a promotional partner that could help amortize programming costs — couldn’t make the daypart worth its while financially. It’s a stark change from the late 1990s, when “Power Rangers” helped Fox rule the broadcast kids audience.

Once the four-year term is up, 4Kids will be able to renew the deal for two more years.

(Josef Adalian in Hollywood contributed to this report.)

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