Disney Ups Sweeney to Laybournes Old Post

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Disney Channel president Anne Sweeney was promoted last
week to the slot left vacant by the executive who brought her to cable, Geraldine
Laybourne, as Sweeney was named president of Disney/ABC Cable Networks on the eve of the
digital-channel explosion.

As part of the responsibilities of her new post,
40-year-old Sweeney will oversee Disney's interests in four additional cable
networks, manage ABC's Saturday-morning kids' schedule, be on the lookout for
acquisitions and explore developing new cable-programming services.

"There are a couple of networks on the board that
we're looking at," said Sweeney, who will retain the title of Disney Channel
president and remain based in Los Angeles. "I will look at the development and
acquisition of new channels."

Sweeney, who had previously also held the title of
executive vice president of Disney/ABC Cable, will now be fully responsible for The Walt
Disney Co.'s interests in Lifetime Television, A&E Network, The History Channel
and E! Entertainment Television. Disney also launched two digital channels this year: Toon
Disney, a 24-hour animation network, and Lifetime Movie Network.

"I have been very involved not only in the portfolio
of equity investments, but also in developing new ideas, like Toon Disney," said
Sweeney, who will report to ABC Inc. president Robert Iger.

Like Laybourne, Sweeney won't have any responsibility
for ESPN, the other Disney cable fiefdom. Laybourne left Disney in May to form her own
production company, lining up Disney as one of her first investors.

Sweeney is credited with spearheading Disney Channel's
continuing conversion to a basic service from a premium network, jump-starting its
distribution, transforming it into one of the highest-rated cable networks and bringing in
a team -- including senior vice president of programming Rich Ross -- that has invigorated
its schedule.

"My impression of Anne is that she is a breath of
fresh air to Disney Channel," said Jerry McKenna, vice president of strategic
marketing at Cable One. "The programming has improved dramatically. Frankly, it had
gotten a little stale."

Added Phil Laxar, senior vice president of programming at
Jones Intercable Inc., "[Disney Channel's] programming has improved over the
past couple of years. It had seemed to be a little tired. It didn't have any
zip."

Sweeney came to Disney Channel in February 1996, after
leaving FX Networks Inc., where she had been chairman and CEO since 1993. Prior to
presiding over the launch of FX and FXM: Movies from Fox, Sweeney was at Nickelodeon,
where she was hired by Laybourne immediately after getting her master's degree in
education from Harvard University.

"She was the first person I hired at
Nickelodeon," Laybourne said. "She's an unbelievably strong, direct,
assertive executive who gets things done. And she's an unbelievable
team-builder."

When Sweeney came to Disney Channel, its distribution was
15 million. Now, it stands at 42 million, with about 38 million on basic. But not every
MSO has embraced the conversion, with Time Warner Cable and Comcast Corp. still on the
sidelines holding out.

One operator's beef was that Disney Channel shrewdly
made carriage deals with direct-broadcast satellite, MMDS and hardwire overbuilders that
required the network to be placed on basic.

"In effect, that forced cable operators to compete by
putting the service on basic," the MSO official said. "That started the
avalanche for them to get 38 million [subscribers on basic]."

With the conversion, cable systems not only lost revenue
from Disney Channel as a premium service, but they also had to pay one of the priciest
license fees for a national network -- in the range of 60 cents to 75 cents per month, per
subscriber -- according to cable operators.

"It was a pretty pricey conversion," the MSO
official said.

But Disney Channel still isn't as expensive as its
sister service, ESPN.

For her part, Sweeney noted that Disney Channel depends
solely on license fees, since it doesn't carry advertising, which is one of the
allures of the channel.

"What we hear back from kids and parents is that
it's being commercial-free is why it is valued so highly," Sweeney said.

Sweeney was a panelist at a roundtable held in Dallas last
week by the Texas chapter of CTAM. Pam Burton, director of marketing for Prime Cable,
attended the panel, and she was impressed by Sweeney's emphasis on programmers having
to make a connection with their viewers.

"She has great ideas, and she is doing a great
job," Burton said. "And we believed in Disney Channel being on basic before it
was cool. We feel that there's a lot of added value."

Disney explored the idea of launching a 24-hour news
channel, as well as a kids' educational channel, which was dubbed ABZ, eventually
backing away from both ideas. But the media giant has been no slouch in expanding its
cable holdings. Sweeney herself launched Toon Disney in April, racking up 6 million
subscribers to date. And ESPN launched ESPN2 and ESPNews in the past few years.

Networks that Disney owns pieces of have rolled out new
networks, too. Lifetime spun off its all-movie channel, while A&E launched History,
and it has two digital networks ready for the fall -- one a biography channel and one on
international history.

As for Disney grabbing cable shelf space, "in the
scheme of things, they are doing pretty well," said Tom Wolzien, an analyst with
Sanford C. Bernstein & Co.

E! president Lee Masters first met Sweeney when they were
both at MTV Networks, and he has dealt with her in her role as Disney/ABC Cable executive
vice president.

"I've got great respect for Anne and what's
she done," he said. "She'll bring a lot to the table for us."

Disney Channel currently has an experiment going on called
"Zoog Disney," which airs during special blocks on Saturday and Sunday. During
Zoog Disney, kids and families are directed to the Internet to play games and enter
contests relating to the programming being aired. Disney is testing the convergence of
television and computers, Sweeney said.

Burton's daughter enjoys participating in Zoog Disney.
"That is the future," Burton said.

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