Mediacom-Fox Deal Boosts Nat Geo

9/29/2002 8:00 PM Eastern

Mediacom Communications Corp.'s efforts to renegotiate deals with programmers after doubling in size bore fruit last week in a new agreement with Fox Cable Networks Group.

For Fox Cable, the big payoff for what affiliate sales chief Lindsay Gardner called 11 months of negotiations was a promise to immediately launch National Geographic Channel on its digital tier. Mediacom had 329,000 digital subscribers at the end of June, and 1.6 million basic customers in 23 states.

As a result, NGC — co-owned by Fox and National Geographic Television & Film — will be in 34.6 million homes in the near term, with commitments to top 57 million homes over time. Fox now has distribution deals for Nat Geo among all major distributors except Cox Communications Inc.

Gardner, executive vice president of affiliate sales and marketing at the News Corp.-owned group, said he also expects to obtain more Mediacom distribution for Speed Channel and possibly for other Fox Cable services.

"They made a judgment they could do a deal with us," Gardner said of Mediacom executives. "It didn't happen overnight, but we got it done."

He conceded the agreement contains "rate adjustments in [Mediacom's] favor," but that's logical, because Mediacom decided to rework its deals after doubling in size with the acquisition of some former AT&T Broadband systems a year ago.

Italia Commisso Weinand, Mediacom's senior vice president of programming, said last week that the MSO has reached new agreements with some other programmers, but hasn't announced them.

"Fox really wanted to announce this to feature Nat Geo in our digital platform," she said.

The comprehensive agreement also includes renewals for six Fox regional sports networks, she said.

She said a key motivation for Mediacom in seeking new deals at better rates was the upside potential for programmers in the operator's plans to upgrade the former AT&T systems, adding capacity to them.

"If we didn't exist, these properties would have laid dormant and been 45-channel systems, or 30-channel systems in some cases," she said.

Negotiations are ongoing with several programmers, she indicated, without naming names.

Weinand said Mediacom was genuinely pleased about adding NGC, which provides educational and family-friendly programming that can help drive digital sales.

Mediacom has previously acknowledged that digital penetration stalled in the second quarter, a result of raising the price for many services the company felt AT&T had underpriced, and of pulling back on some efforts to market digital until the new pricing had settled in.

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