Fox Family Channel this week plans to pull the plug on its two digital networks, boyzChannel and girlzChannel, after struggling for a year to secure them distribution.
The networks'owner, Fox Family Worldwide Inc., said it was hard to gain carriage without retransmission-consent leverage, and added that digital-cable platforms have rolled out more slowly than expected.
But others in the cable industry also said Fox Family put too high a price tag on the twin digi-nets.
Ironically, Fox Family was finally on the verge of completing carriage deals for boyzChannel and girlzChannel with AT & T Broadband and Cablevision Systems Corp., which planned to launch the two digital services in Boston.
"We were about to go up on AT & T, and it was being so close that has made us really look at where our resources are going at the company," Fox Family general manager Tracy Lawrence said last week.
"We really made a decision that the proper place for our resources to go right now is back into Fox Family Channel, even though we strongly believe in boyzChannel and girlzChannel as concepts," she added. "We really need to reinvest our time, our money and our resources in Fox Family Channel."
Fox Family isn't the only programmer to scrap a digital network recently. Discovery Networks U.S.-another programmer that couldn't use retransmission consent as a bargaining chip-took Discovery People black earlier this year.
Fox Family-a partnership of Saban Entertainment and News Corp.-debuted boyzChannel and girlzChannel last Halloween. But so far, Fox Family had only struck affiliation deals for the digi-nets with a few small operators, according to Lawrence. She roughly estimated that the channels only had 100,000 subscribers or so.
Fox Family has notified Matt Bond, AT & T Broadband's executive vice president of programming, that it was going black with boyzChannel and girlzChannel by this Friday (Aug. 18), Lawrence said. Fox Family will also discontinue the two digi-nets'companion Web sites.
AT & T Broadband had planned to add the two Fox Family digital networks to the new transponder, No. 13, that is being added to Headend in the Sky, its digital platform.
"We have no concern about finding programming for HITS," an AT & T Broadband spokeswoman said.
That new HITS pod, expected to debut in October, is slated to include a number of fledgling services such as Major Broadcasting Corp. Network, Fanfare: The Classical Music Channel, Book Network, CNBC2, Do It Yourself, Great American Country and New Urban Entertainment.
Rich Cronin, who abruptly exited as Fox Family's president in May, was the major proponent of boyzChannel and girlzChannel, which were announced in late October 1998.
Lawrence cited several reasons for shelving boyzChannel and girlzChannel, apart from Fox Family wanting to concentrate on its analog service.
"The distribution environment for digital changed a lot between the time we made the decision to launch and now," she said. "It has become a lot more crowded. A number of operators have delayed their rollouts, and they are becoming more hesitant to commit to concrete distribution numbers. In terms of kids' services, it's a very crowded marketplace."
Among the programmers with digital networks targeted toward kids are The Walt Disney Co.'s Toon Disney; Turner Broadcasting System Inc.'s Boomerang; Noggin, a joint venture of Nickelodeon and Children's Television Workshop; and Nickelodeon Games and Sports.
A number of these programming giants have special bargaining chips, like retransmission consent, to gain carriage for their digital services, Lawrence said. Fox Family doesn't have that advantage.
"It doesn't help that there are a lot companies out there that are using a lot of leverage to get their channels in, like retransmission [consent] and taking discounts off of the base channel to get digital channels launched," she added. "You have to evaluate where you're putting your investment as a company and if it's really worth it."
Several sources claimed that Fox Family went to cable operators seeking license fees for boyzChannel and girlzChannel that were exorbitantly high for digi-nets-roughly 25 cents per month, per subscriber for each service.
"It was the initial pricing," one cable-industry source said. "They had an unrealistic plan. And they were without the leverage of retransmission consent. Those factors doomed them."
But Lawrence denied that pricing was a problem. "We did get to the point where we were doing deals," she said.
The two digi-nets' daytime lineups included original programming and programming from the Fox Family Worldwide library, while their nightly shows targeted parents.
The idea of creating separate networks for boys and girls initially caused some controversy, with some critics complaining that the channels might offer up programming that enforced sex-role stereotypes.
But Cronin denied that the digi-nets would promote stereotypes, and quickly marshaled child-care experts and academics to defend the notion that boys and girls would have interests in different kinds of TV shows.
Fox Family, which has fought to stop its own ratings drop since it relaunched two years ago, is now concentrating all of its energy on its core analog channel, Lawrence said.
Fox Family earlier this month debuted a revamped, more contemporary on-air look and logo, all part of its effort to highlight its evening adult-driven programming. That includes newly acquired off-network fare such as Providence and Freaks and Geeks.
"Fox Family is an adult-driven destination in primetime," Lawrence said. "We're just focusing all of our resources so that we have a consistent, strong, coherent strategy. That's what this decision is about."
The network plans a branding ad campaign in September that will focus on primetime as a destination for adults, Lawrence said, adding that Fox Family plans to increase its marketing budget 40 percent for this fiscal year.
Over a four- or five-year period, Fox Family is investing $400 million in original and acquired programming.
"We decided that if we're going to make this kind of commitment in programming, we really need to upgrade our marketing and our on-air look to complete the package," Lawrence said. "The new on-air look reflects a more contemporary, family-driven channel. It is more supportive of a channel that incorporates adults, as well as kids."
When the former The Family Channel relaunched, aiming to draw viewers younger than 50, its household ratings took a nose-dive.
Most recently, in July, Fox Family was up 33 percent in total day, to a 0.4, in the daypart where it is attracting kids and so-called tweens. But the network was down 13 percent in primetime to a 0.7, according to Nielsen Media Research.
This summer, Fox Family Worldwide chairman Haim Saban denied published reports that he was trying to sell his stake in Fox Family to News Corp. and was also trying to shop the whole company.