AUGUST 3, 1998 Cahners Bro idcastíig&CaIe oa cas mlca *** * * * * *** * * * * * * * **3 -DIGIT 591 IIIIIIIIItlliIIIIlll illlllllllllllllllIldshliI. lI BC075184 AUG99 R=GB 330 JOHN C JOHNSON GTyQ -TV 265 WATERTON WAY BILLINGS, MT 59102 -7755 www.americanradiohistory.com r ,M www.americanradiohistory.com i IRIDIUM -" INTRODUCING THE WORLD'S FIRST HANDHELD GLOBAL SATELLITE PHONE AND PAGING NETWORK. NOW YOUR WIRELESS SERVICE CAN COVER THE EARTH. IRIDIUM CALL TOLL FREE 877-542 -6793 WWW.IRIDIUM.COM calling planet earth www.americanradiohistory.com Broadcasigetable August 311998 www.broaticaslingcable.com Volume 128 Number 32 TOP OF THE WEEK / 6 Allen's big buy not his last Paul Allen's takeover of Charter Communications Corp. is not likely to be the soft- ware billionaire's last stop on the cable acquisition trail. Allen's view of the "wired world" calls for extending his reach widely his cable operation to get much bigger. / 6 Fili- Krushel to head ABC TV New ABC Television Network President Pat Fili- Krushel will take responsibility for both ABC Entertainment and ABC News, decreasing the direct reports to ABC Inc. President Robert Iger. / 10 Falco named NBC TV Network president Randy Falco, incoming presi- dent of the NBC Television Network, says he'll focus on an improved relationship with affiliates and a marketing plan to promote NBC at a time when audience share continues to erode. / 11 GM: On the TV road again The settlement of the General Motors strike leaves the unanswered question of how much of GM's almost $280 million third -quarter broad- cast television budget can be salvaged. / 14 Finally, a woman heads one of the Big 3 TV networks. / 10 Lott cautions cable operators on rising rates Senate Majority Leader Trent Lott's surprise visit to a Senate Commerce Committee hearing on cable rates may encourage cable operators to exercise restraint in rate hikes. / 18 For more late -breaking news, see "In Brief" on pages 64-65 over control of red -ink -laden Eye On People to Discovery Woman's work COVER Communications. / 36 still excludes STORY / top jobs High speed, high stakes for US West's VDSL Since last Septem- k 0,0,0 US West vov.ed to make its new, very- ber, the industry's most prominent and high -speed digital subscriber line service arguably most pow- available to 400,000 people in the wingaL imam erful women have Phoenix area by year end, but a trial in Gilbert, Ariz. has only about 25 sub- lost their jobs, Judge Wapner's West depleting the industry of top -level women and under- scribers, all US employees. / 37 court is back in session. / 39 scoring the fact that men are still running the show in TV. / 22 Cover photo by Ken Davies/Masterfile Investors consider the Source Persistent rumors that Source was about to be acquired have brought about a BROADCASTING 128 climb in its stock. / 39 WB, UPN pitch their plans UPN and The WB TECHNOLOGY /40 each portrayed itself to TV critics in Pasadena as the WNET signs HD deals with Sony, Tek emerging network with the best plan and prospects for the New York City PBS station WNET(TV) signs a three -year coming season. 28 / deal with Sony for 10801 HDTV production and post -pro- Ups and downs for Sinclair earnings Sinclair duction equipment and another three -year contract with revised its estimate for third -quarter broadcast cash flow Tektronix for HDTV mater- control gear. / 40 down by $8 million, to about $88 million, analysts said -an be a a 29 aberration in what should rosy year and half. / Dereg plan for advanced telecom gets mixed Litton scores a 10 With two new syndicated series reviews An FCC initiative to offer RBOCs a deregulat- coming to broadcast stations this fall, Litton Syndications ed atmosphere in which to develop advanced data services will celebrate its 10th year in the industry with the most drew a mixed reaction among Internet service provider shows on the air in the company's history. / 31 executives and analysts last week. / 42 CABLE / 36 Changing Hands 44 Datebook 59 Fifth Estater 60 CBS takes one eye off `People' Corporate finan- Classified 64 Editorials 66 Nielsen Ratings.33, 38 cial pressures push CBS Cable into cutting a deal to hand Closed Circuit 17 Fates & Fortunes 61 Washington Watch...20 4 BROADCASTING a CABLE I AUGUST 8, 1988 www.americanradiohistory.com rkai IL 14 SAVED BY THE BELL SAVED BY THE BELL: The New Class CALIFORNIA DREAMS bielt AffP the most popular guy with teens, your global appeal just keeps growing NBC ENTERPRISES www.americanradiohistory.com Broadcasting &Cable TOP OF THE WEEK Allen's big buy not his last More deals to follow last r1'eek's purchase of Charter for $4.5 billion By John M. Higgins of MSOs. "He wants to largely because the bil- he one of the top three lionaire co- founder of p,ul Allen's breathtaking $4.5 bil- operators." says one Microsoft Corp. gave - 1 ion takeover of Charter Commu- executive involved in credence to recent tech nications Corp. last week is not the Charter deal. That nology boasts by MSO likely to he the software billionaire's would call for Allen to executives. That boost last stop on the cable acquisition trail. grow to more than 5 almost matched the In fact, his operation already is devis- million subscribers. credibility attached to ing plans for more deals, with the goal from the 2.4 million Microsoft Corp.'s own of creating the widest possible reach. he'll have by combin- Si billion investment in Allen's view of the "wired world" ing Charter with the Cornetist Corp. a year calls for greatly extending the reach of Marcus Cable Corp. ago. his cable operation. He has aggressive- operation he bought in Allen's top dealmak- ly embraced other operators' vision of May. er, William Savo. who cable systems: not as video delivery That would let him Paul Allen -wants to be one of runs Allen's Vulcan systems for MTV and ESPN. but as the pass MediaOne Group the top three operators." Ventures, denies that he only fat pipeline into the home, with Inc. -which, not inci- has any specific size for smart set -top converters enabling not dentally. is considered by industry and the company in mind. But he acknowl- just fast Web surfing but all sorts of Wall Street executives to be a prime edges that Allen will be "opportunistic" video. software and communications takeover target. as potential system deals arise. services tied in part to the television Allen's initial entry into the cable "We are cry excited about this set. market -the $2.8 billion takeover of opportunit\." Savoy says about Char- Allen is set on being in the top ranks Marcus Cable-electrified the industry, ter. "We're pleased to find an outstand- Marcus executives: Move it or lose it When Paul Allen cut his deal to buy Marcus Cable "When Jeff took the Chancellor job it was clear that Corp. in April, employees celebrated over his repeated Allen needed to do something," says one deal insider. declarations that he wanted to keep the company's Dal- "What they did here was pay both for systems and a las -based management team intact and use it as the management team." core of a cable empire. The problem isn't simply that Allen will be axing so many The enthusiasm didn't last long. people. That's almost always done when a company is Last Thursday's $4.5 billion deal to sold. ( "They're doing exactly what we've done to a dozen buy Charter Communications Inc. companies," says one Marcus Cable executive.) What's calls for that operator's president, particularly irritating to Marcus Cable's people is the rever- Jerry Kent, to run the combined oper- sal of public and private assurances from Allen and his ation out of Charter's St. Louis head- executives. The employees found out about the change in quarters. That means Dallas will be at a meeting the afternoon before the deal was announced. best a satellite office, and many of the Marcus says that the Dallas reductions are an unfortunate 200 corporate employees will have to side effect. "On the one hand, I am extremely pleased to be it course sad- Jerry Kent move or lose their jobs. associated with my good friends at Charter: of In the turf fights at systems and dens me to see the closing of the headquarters in Dallas. regions, suddenly Marcus Cable executives won't be "Those people who go on to St. Louis to work at merged calling the shots on how operations are consolidated; companies will be a part of an exciting enterprise," Marcus Kent will. "It's a wipeout," says one Marcus Cable exec- says. "Those who don't will have my gratitude and my utive who had been briefed on the plans. "I don't expect appreciation for all their hard work and effort." many to survive." Marcus notes that a slice of the proceeds already has been The problem stems in large part from Marcus Cable divided among Marcus Cable employees. "Fourteen million- Chairman Jeff Marcus's agreement also to become chair- aires were created, and others also shared generously." man of Chancellor Broadcasting, the radio and TV station Kent emphasizes that Charter is now doubling in size, group controlled by Dallas -based LBO investor Hicks, creating plenty of opportunities for Marcus Cable's peo- Muse, Tate & Furst. Hicks Muse is an investor in Marcus ple. "I'll need Jeff's help in shepherding those people to Cable, and its chairman, Tom Hicks, is close to Marcus.