After years of on-and-off speculation about a mergerbetween pay-per-view networks Request Television and Viewer'sChoice, Request will close its doors June 30, leaving Viewer's Choice as theleading outlet for the $1 billion-per-year PPV business, sources to the situation said.
But while many operators hailed the finality of thelong-running soap opera between the two networks and looked forward to a unified PPVbusiness, other operators and some distributors were upset over the demise of Request,which received high marks for its professionalism.
Some industry executives were also concerned about puttingall of PPV's eggs in one Viewer's Choice basket, and they may look to otherPPV-distribution outlets if they don't get satisfaction from the incumbent service.
Request, which is owned by Tele-Communications Inc.and 20th Century Fox, will go out of business after 13 years in variousincarnations, sources close to the situation said. TCI, however, will not suffer: It ownsa piece of Viewer's Choice, making the transition of its 4 million addressable subscribersa nonissue.
In fact, it was TCI's decision not to renew its Requestaffiliate agreement that was used to seal the network's fate.
In a statement issued to its affiliates last Friday,Request said, "TCI, our largest affiliate, will not be renewing its affiliateagreement with Request as of July 1, 1998. Due to the loss of our largest affiliate, theowners of Request -- Liberty Media [Group] and 20th Century Fox -- have determined thatthe long-term prospect of continuing the operations of Request is not economicallyfeasible. Therefore, Request will discontinue its major business operations [the Requestprogramming service] as of June 30, 1998."
A TCI spokeswoman said the MSO is close to reaching adistribution deal with Viewer's Choice, adding that TCI's decision not to renew withRequest was based on the latter's future economic uncertainty. "Our priority is thatthere will be no disruptions to our pay-per-view customers," she said.
Viewer's Choice is also owned by major MSOs Advance/NewhouseCommunications (a Time Warner Cable-run joint venture), Comcast Corp.'s ComcastCable Communications, MediaOne, Cox Communications Inc.and Time Warner.
Hollywood studios Paramount Pictures, Walt Disney Pictures& Television and Warner Bros. round out the network's board of directors, althoughsources said the MSO owners may seek to buy out the studios' interest in return forlong-term PPV-distribution deals.
Request's closing ends one of the longest-running mergerwatches in cable history. For years, the industry has been trying to combine the twonetworks in order to create a unified message for the beleaguered PPV industry. Now, someoperators believe that with all of the marketing, distribution and licensing deals underone roof, the business can finally move down the right path, particularly heading into thenew digital world.
"It's about time something happened," oneoperator said.
But some questions remain. Outside of TCI, Request willstill have to make deals with all of its affiliates, including major MSOs CablevisionSystems Corp., Adelphia Communications Corp. and Jones Intercable Inc.
At least one Request affiliate is taking a wait-and-seeattitude.
"We would like to do business in the easiest, leastcomplicated way," the operator said. "I don't foresee a problem, but if therewas one, there are certainly other options that we can choose."
At least two other distributors -- TVNEntertainment Corp. and BET Holdings Inc.'s Action Pay-Per-View-- currently offer PPV channels. Action-adventure-oriented Action PPV has about 9 millionsubscribers in an analog environment, and it is expected to make its digital plans knownat the National Show next month. TVN offers 32 digitally compressed channels, and it iscurrently testing the service in six markets.
PPV-programming executives were also concerned about havingonly one network to license their programming. Distributors previously could leverage bothRequest and Viewer's Choice to get the best deals, but now, with just one entity,executives said it may be more difficult to get reasonable deals.
"I could deliver the industry a great show that couldmake cable a lot of money, but [Viewer's Choice] could come back and say, 'Only if yougive me at least 10 percent of the split.' I think that independent distributors should bevery concerned," one executive said.
It is unclear whether any Denver-based Request employeeswill move over to New York-based Viewer's Choice. Request president Hugh Panero, however,will not make the transition. He was unavailable for comment last week.
PPV executives lauded Request for its professionalism andits work ethic.
"The respected individuals of Request bring anunparalleled level of creativity, diligence and expertise to the business, and they willbe sorely missed and difficult to replace," said Dan York, vice president and generalmanger of TVKO.
Founded by Jeffrey Reiss in November 1985, Request wasoriginally owned by Reiss Media Enterprises. Group W Satellite Communications bought a 50percent share in May 1989. In June 1992, Fox and TCI took a combined majority interest inRME, which bought out Group W's stake in Request. Today, Fox and TCI are the sole ownersof the company.
The company launched Request 2 in 1988, followed by threemore channels in 1993.