Nets Face Off in Country's Capital

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Great American Country, the plucky independent network, this week is launching a full-scale invasion of the home turf of CMT: Country Music Television, part of giant Viacom Inc.'s cable stable.

GAC will be added to Comcast's expanded-basic lineup in Nashville, Tenn., a rollout that will give the country-music video channel roughly 280,000 new subscribers. That Comcast system already carries GAC's bigger rival, CMT.

"It's huge for us to get that launch, in terms of our exposure to the country-record labels and the artists themselves," GAC president Jeff Wayne said last week. "Now they can see the network."

While some operators, like Comcast, are making room for both GAC and CMT, it remains to be seen if the two country-music services — which compete not only for carriage, but for similar viewers and advertising — can survive in the long term.

GAC has fortified its beachhead in Nashville, but it's still an underdog facing an uphill battle against CMT, which is headquartered in the hometown of the Grand Ole Opry. Bankrolled by Viacom, CMT's distribution and ratings are eclipsing those of GAC, which has made steady but smaller strides.

CMT'S RED HOT

Since Viacom took over CMT's ownership in 2000 as part of its merger with CBS Corp., the network has been hot as a pistol.

Bolstered by hipper original programming and the leverage of Viacom's MTV Networks' affiliate-sales force, CMT's distribution has soared. It now stands at 63.1 million homes, up 13.7 million over the past year alone. That makes CMT the fastest-growing network, according to Nielsen Media Research.

GAC's carriage has also increased. It's now at 20.7 million, up 5.8 million over the past year, according to Nielsen. But its distribution is still only roughly one-third of CMT's.

CMT and GAC are giving operators a real choice, since their country-music programming strategies are as different as their ownership.

Viacom and MTVN have spent millions of dollars to revamp CMT's schedule, adding more original specials and long-form shows to its lineup.

"Long-form programming makes MTV [:Music Television] and VH1 work, and that was our ambition for CMT, to get in that game," CMT general manager Brian Philips said. "That's what's getting a rating for us … Music videos in and of themselves are just a commodity."

In response, indie GAC has also upgraded programming. But it comes down on the side of being "music-intensive," sticking to its knitting by airing more music videos, which it calls a plus.

RATINGS GAP

CMT's programming tack seems to be clicking with viewers. In July, for example, CMT posted a 0.3 rating in primetime, up 50 percent from a year ago, according to Nielsen. GAC tallied a 0.1, although there are no comparable numbers for July of last year.

Wayne claims that Englewood, Colo.-based GAC is taking a hit in the ratings because it's been moved to digital tiers on some systems. And now that "more and more markets are carrying both GAC and CMT," country-music TV viewership is being split up, according to Wayne.

Earlier this year, sources said MTVN was looking to buy GAC, whose parent is Jones Media Networks Ltd. But the deal never happened. So GAC — once tied to the MSO Jones Intercable, with Glenn Jones still Jones Media's chairman and major shareholder — remains an independent service.

It has no major MSO ownership, although Adelphia Communications Corp. owns a 7 percent stake, and has no ties to any media giants.

While that's often a disadvantage for GAC, it can work in the network's favor when dealing with small cable systems.

Smaller cable operators had a tempestuous relationship with CMT when it was owned by CBS, and they had a strained relationship with Viacom even before it became CMT's new owner. Currently, neither CMT nor TNN: The National Network (the former The Nashville Network, also acquired in the CBS merger) have a carriage deal with the National Cable Television Cooperative, which represents small, independent cable systems serving 14 million homes.

GAC, which has a history of paying launch fees for carriage, has a long-term deal with the NCTC, and 250 of the co-op's member companies carry it. When CMT was still under CBS's ownership, a number of small systems switched it out for GAC.

"We're very happy with GAC," NCTC senior vice president of programming Frank Hughes said.

BIG BUNDLE

MTVN's carriage deal with the NCTC for MTV, VH1 and Nickelodeon expired at the end of June, and the programmer and the co-op are working on a renewal, according to operator sources.

At first, MTVN was looking to include TV Land under that agreement. Now, it's looking to add CMT and TNN to the bundle as well.

The NCTC's contract with TV Land expired the end of last year, and MTVN has been playing hardball since then, the sources said. Initially TV Land — which is reportedly seeking double-digit license-fee increases — tried to pressure some small cable systems to sign individual carriage agreements with the network, rather than waiting for the NCTC to craft a master affiliation-deal renewal.

TV Land has threatened to pull its signal from some small systems that are out of contract, according to sources.

Placing six MTVN channels — MTV, Nick, VH1, TNN, CMT and TV Land — under one affiliation agreement poses many issues for operators. For one, the contract that expired in June and covered just three networks was extremely complex, and required NCTC members to carry all three channels pretty widely. Adding three more networks to the one carriage deal would make that contract even more complicated. And if MTVN wants NCTC members to carry all six Viacom services widely, that poses a problem for bandwidth-constrained small systems.

MTVN president of affiliate sales and marketing Nicole Browning and Hughes both declined to discuss their contract negotiations.

"The NCTC has been a partner," Browning said. "We'd, to the extent that it makes sense, look at developing a broader partnership with them."

Hughes confirmed that the NCTC doesn't have a CMT deal and added, "We are discussing CMT as part of a broader agreement with MTV Networks."

CMT LAUNCHES

CMT has conducted major launches this year, Browning said, mainly on AT&T Broadband systems in Boston, Atlanta, Seattle, the San Francisco Bay area and Pittsburgh. She credited CMT's revamped programming as one reason why so many systems are launching it.

"It's a bit more sophisticated that it's been in the past," Browning said. "That's more appealing to viewers and operators."

Comcast officials said it made sense to add GAC in Nashville, where it already offers CMT, because there's strong demand in the market.

"In Nashville, we're located in the country-music capital of the world," a Comcast spokeswoman said. "This is what our subscribers want and have been asking for. And the two networks take a slightly different approach to programming."

In conjunction with its launch, GAC has expanded its presence in Nashville, where it produces two shows. The network this month moved its Nashville facilities to new space on "Music Row" that will house radio and TV studios, as well as ad sales, marketing and artist-relations services.

On the carriage front, GAC also got a boost earlier this year when Time Warner Cable added it to its digital lineup in New York City.

NEW GAC SHOWS

Faced with CMT's upgrade, GAC has also been retooling and revamping its programming. In September, GAC will debut a new weekly show, The Great American Roadhouse.
GAC also brought in Bobbie Eakes, who was on the soap The Bold and the Beautiful,
as the new host of its daily request show, CRL.

Wayne said that GAC had continued to focus on airing a wide variety of country-music videos, including up-and-coming talent, while CMT is going more "crossover," featuring non-country artists like Kid Rock. An episode of CMT Crossroads
in February featured Kid Rock and Hank Williams Jr.

Philips said CMT Crossroads,
which pairs a high-profile country artist with a pop or rock star, is merely part of CMT's attempt to broaden the traditional country audience.

"It sort of widens the aperture," Philips said. "Viacom is committed to long-form programming. Everybody knows it's the way to go. There are unmined, untold stories in this town."

MUSICAL PURISTS

GAC still claimed that CMT has gone astray of its country-music mission.

"CMT was playing movies for awhile, and getting way off course," Wayne said. "We've really stayed the course in the development of the network, with a continuous upgrading of what we've been doing. We're still much more music-intensive."

During a recent week, for example, GAC had 388 different videos in rotation, and aired them 1,588 times, according to Wayne. CMT during that period played only 293 different videos, running them a total of 1,254 times.

"We're playing more videos and a greater variety," Wayne said.

Again, Philips noted that across the board — be it on MTV, VH1 or CMT — viewers have responded to long-form shows, rather than music videos.

He added that CMT has aired theatricals only sporadically. "We don't want to go too far afield. "

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