News

Cable Co-Op Finally Lands Mouse Deals

11/15/1998 7:00 PM Eastern

The National Cable Television Cooperative reached a master
affiliation agreement last week for its members to carry Disney Channel and Toon Disney on
basic, officials said.

The deal is the second one in recent months that the NCTC
-- the cable-system affiliates of which serve about 8.5 million homes -- has reached with
a network owned by The Walt Disney Co. In September, the NCTC closed a deal with ESPN,
which, like Disney Channel, had been a longtime holdout.

Under the Disney Channel deal, which spans seven years,
NCTC members will not only get a group discount on the service's pricey license fee,
but they will also reportedly get marketing support in the range of $1.50 to $1.75 per
subscriber.

"A lot of our members will benefit immensely from this
deal," said Frank Hughes, the NCTC's senior vice president of programming.
"Disney would be classified as one of the top three networks in license fees."

Hughes, referring to both the Disney and the ESPN
contracts, said, "This is a big deal for the co-op and its members. These are a
couple of marquee services that have held out for years."

Disney Channel has been aggressively converting its
carriage from that of a premium service to basic. In fact, Charlie Nooney, Disney's
senior vice president of sales and affiliate marketing, said the network is no longer
signing premium-carriage agreements.

Hughes said the co-op isn't advocating that its
members carry Disney Channel as a basic service, adding that whether or not to do so is
under their discretion.

Disney Channel's license fees, depending on the
operator and what volume discounts they're getting, range widely, from 75 cents to
more than $1 per month, per subscriber, according to sources familiar with the deal.

Disney Channel has 43 million subscribers, with just under
4 million of those getting it as a premium service. Toon Disney, the animation spinoff, is
now carried in 7 million homes.

Eventually, the NCTC and Disney may amend their carriage
agreement to permit the co-op's members to carry Toon Disney on digital.

"We are still working with them on that," Nooney
said.

Many of the co-op's members are taking their digital
programming via Tele-Communications Inc.'s Headend in the Sky, which said this week
that it is adding Toon Disney to its digital lineup in December, along with A&E
Television Networks' upcoming digital offerings, The Biography Channel and History
Channel International. Although word of A&E's two digital channels first leaked
out six months ago, the company will formally announce them this week.

The co-op is working on a master carriage agreement with
both HITS and A&E, which is partially owned by Disney.

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