Discovery Loses Court TV Plea

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Ted Turner has apparently succeeded in keeping stepchild
Courtroom Television Network in the family -- the Time Warner Inc. family.

As of press time last Friday, the final details were being
worked out for Court TV partner NBC to sell most, if not all, of its 33 percent stake in
the beleaguered trial network for $100 million to co-owners Time Warner and Liberty Media
Group, Tele-Communications Inc.'s programming arm, sources close to the talks said.

Time Warner and NBC declined to comment, but sources were
anticipating an announcement this week -- although some skeptics still wondered if
something would go wrong at the last minute, since all other potential Court TV deals have
fizzled.

Under the plan being discussed, Time Warner vice chairman
Turner and his Turner Broadcasting System Inc. unit would take over management of Court
TV, in effect adding it to his stable of channels such as Cable News Network, TBS
Superstation, Turner Network Television, CNN/SI and CNNfn.

Talks on this plan to save Court TV began after Turner
balked at the three partners selling a controlling interest in the legal network to
Discovery Communications Inc., which was offering $350 million for the 34
million-subscriber service.

DCI's run at the network earlier this month was itself
a surprise, as investment group Evercore Partners Inc. and NBC Cable president Tom Rogers
were set to make a $300 million offer. Some operators were wondering last week about
Rogers' future at NBC, now that his run at Court TV failed.

Both Turner and cable operators were dismayed by DCI's
offer for Court TV, but for different reasons. Turner for more than a year has opposed any
media company buying Court TV, fearing that any such buyer would use the network as a
competitor against his networks, particularly CNN.

In turn, cable operators were vehemently opposed to
DCI's plan to scrap Court TV's format and to use that analog shelf space for
Discovery Health, a new digital network that is set to launch next month, or for an
existing network, The Travel Channel. MSO officials said such a move would be in violation
of their affiliation agreements, and that they would reclaim Court TV's slot for a
network of their choice.

DCI officials did some testing of the waters May 15 by
calling a number of MSOs to say that if Discovery did succeed in buying Court TV, the game
plan, in fact, was to replace it with Travel or BBC America, and not with Discovery
Health. And DCI told operators that it would pay them significant launch fees to replace
Court TV with Travel, as well as offering them equity in Travel, several MSO officials
said last week.

"It seemed like they were trying to do damage
control," one operator said.

A spokesman for DCI declined to comment last week, but the
company had said all along that it was considering replacing Court TV with one of its new
or existing networks.

The future of Court TV has been uncertain for more than a
year, ever since Turner vetoed founder Steve Brill's bid to buy the legal network.

The proposed plan for Turner to take control of Court TV
was only made possible by NBC's change in position and its willingness to sell its
piece of the network to its two partners, a source said.

Employees at Court TV were heartened to hear that DCI
hadn't succeeded in its bid to acquire the network and to abandon its format.

"We've been an orphan," one Court TV
official said. "Now, we're coming into a family. There is a general sense of
comfort that the network will continue to exist."

However, there are still a huge number of questions
remaining about Court TV's future under Turner. It remains unclear if he will move
the network's operations from New York to Atlanta, or to what extent he will
integrate its affiliate and ad-sales operations into TBS Inc.'s infrastructure. And
how Court TV's programming will change under Turner also remains a big question mark.
Last year, there was speculation that Turner was looking to merge Court TV and CNNfn,
which had about 9.5 million subscribers as of March.

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