Corporate Television: Who Owns The Networks?
HOWARD BEALE: “We are no longer an industrialized society; we aren’t even a post-industrial or technological society. We are now a corporate society, a corporate world, a corporate universe. This world is a vast cosmology of small corporations orbiting around larger corporations who, in turn, revolve around giant corporations, and this whole endless, eternal, ultimate cosmology is expressly designed for the production and consumption of useless things . . . ”
NARRATOR: “By the end of June,The Howard Beale Show was down eleven points, a catastrophic condition.”
–from the 1976 movie Network, written by Paddy Chayefsky
East Coast, 30 Rockefeller Plaza, New York, NY 10112
West Coast, 3000 W. Alameda Ave., Burbank, CA 91523
NBC (National Broadcasting Company) was created in 1926 by the Radio Corporation of America (RCA),General Electric, and Westinghouse. In 1932, GE and Westinghouse withdrew and sold their ownership shares of the network to RCA, who then acquired sole ownership of NBC. The buy out was done to avoid prosecution by the U.S. Justice Department because of antitrust concerns.
Then in 1985, RCA, including NBC, was bought by the General Electric Corporation for $6.3 billion.
NBC Cable Services operate the Consumer News & Business Channel (CNBC, 2200 Fletcher Ave., Fort Lee, NJ 07024), the Prime SportsChannel Network, and the NBC Super Channel which broadcasts English speaking programs in Europe, Asia and Mexico.
The General Electric Corporation manufactures military and commercial aircraft jet engines. It also produces appliances such as refrigerators, electric stoves, microwave ovens, washers and dryers, air conditioners, and (of course) televisions. Its products are sold under the GE, Monogram, Profile, RCA and Hotpoint brand names. GE also manufactures a vast array of electrical equipment, medical technologies such as x-ray machines and ultrasound equipment, AC and DC electric motors, plastics, silicones, superabrasives, train engines, and steam turbine equipment for nuclear power plants.
1994 Revenue: NBC (broadcasting division of General Electric Co.): $3.361 billion.
1994 Revenue: General Electric Co.: $59.316 billion.
1995 Revenue: General Electric Co.: $69.276 billion.
1997 Revenue: General Electric Co.: $90.84 billion.
A joint venture between NBC and the Microsoft Corporation which debuted in July, 1996. A 24-hour all-news cable network with some programs that Microsoft plans to adapt for simultaneous online use via the Internet. The network has contracts with Tom Brokaw, Katie Couric and Bill Moyers for an hour-long primetime live interview show tied to breaking news.
To ensure its place among news services, MSNBC struck a deal with Cox Communications (one of the country’s largest cable operators with 3.3 million subcribers) to make the new network available. NBC, in addition to presenting Cox with a $6.4 million launch fee, has also granted the company exclusive rights to MSNBC through the year 2001; protecting the partnership against any encroachment by a Baby Bell into a Cox system area.
East Coast, 77 West 66th St., New York, NY 10023
West Coast, 2040 Ave. of the Stars, Century City, CA 90067
3800 W. Alameda Ave., Burbank, CA 91505
ESPN (Total Sports Network) & ESPN2
ESPN Plaza, Bristol, CT 06010
A&E; (Arts & Entertainment Channel)
235 E. 45th St., New York, NY 10017, (212) 661-4500
309 W. 49th St., New York, NY 10019
Originally a part of NBC called The Blue Network. ABC was sold by RCA to Edward Noble in 1943 for $8 million. The sale was forced by the Federal Communications Commission because of antitrust concerns. Was officially called ABC (American Broadcasting Company) in 1945.
In March, 1985, Capital Cities Communications bought ABC for $3.5 billion.
On February 9, 1996, the FCC removed the last legal hurdle for the Walt Disney Company to take over Capital Cities/ABC Inc. The deal was worth $19 billion and is the second-biggest corporate takeover after the $25 billion purchase of RJR Nabisco Holdings Corp. in 1989. The Walt Disney Company Empire is simply huge. The company owns five film studios (including Touchstone Pictures and Miramax Pictures); two record companies; three printing companies; four magazines; Walt Disney theme parks in California, Florida, Tokyo and Paris; and the Mighty Ducks National Hockey League franchise.
With its acquisition of Capital Cities/ABC in July,1995, Disney added the ABC Television Network (with 225 affiliated stations); ten broadcast television stations (reaching 25 percent of the U.S. market); four cable TV networks (ESPN (which launched in 1979), ESPN2, Lifetime Television (launched in 1984, formerly the Cable Health Network), and A&E; Television); 21 radio stations; two publishing companies; seven daily newspapers; and six international media companies in Luxembourg, Paris, London, Tokyo and Munich.
1994 Revenue: Capital Cities/ABC: $6.379 billion.
1994 Revenue: Walt Disney Co.: $10.055 billion.
1995 Revenue: Walt Disney Co.: $12.112 billion.
1997 Revenue: Walt Disney Co.: $22.473 billion.
East Coast, 51 W. 52nd St., New York, NY 10019
West Coast, 7800 Beverly Blvd., Los Angeles, CA 90036
Born in 1927 as United Independent Broadcasters (UIB), the network began in Philadelphia as a small radio network with 16 affiliate stations. In 1928, business began to increase and the name was changed to CBS (Columbia Broadcasting System).
On August 1, 1995, the Pittsburgh-based Westinghouse Electric Corporation bought CBS Inc. for $5.4 billion. Westinghouse received $1 billion in additional financing from Chemical Bank and J.P. Morgan to complete the transaction.The Federal Communications Commission approved the acquisition on November 22.
Michael H. Jordan, chairman and chief executive officer of Westinghouse, said: “With the addition of CBS, Westinghouse is creating a premier broadcasting powerhouse and taking a leadership position in programming. Our television and radio stations will reach more homes than any other broadcaster and provide a unique and powerful platform for our advertisers.”
With the merger complete, Westinghouse boasted direct ownership of fifteen television stations covering one-third of the nation’s viewers.
In June, 1996, Westinghouse purchased the Infinity Broadcasting Corporation for $3.9 billion. Infinity owned 44 radio stations across the country, including New York City’s KROC which broadcasts the nationally syndicated Howard Stern Show. The consolidation with both CBS and Infinity rockets the Westinghouse Radio Network from 18 stations to 83, with $1 billion in combined revenues, which accounts for 8 percent of the national radio advertising market.
In addition to its television and radio ownership, Westinghouse also produces steam turbine equipment for nuclear power plants, destroys chemical weapons, and cleans up nuclear waste.
1994 Revenue: CBS Inc.: $3.712 billion.
1994 Revenue: Westinghouse Electric Corp.: $8.848 billion.
1995 Revenue: Westinghouse Electric Corp.: $6.296 billion.
1997 Revenue: CBS Inc.: $9.632 billion. (name changed from Westinghouse Electric Corp. on Dec. 1, 1997)
FOX (Fox Broadcasting Company)
10201 W. Pico, Los Angeles, CA 90035
The Family Channel
1000 Centerville Tpke., Virginia Beach, VA 23463
The Fox Network debuts in April, 1987. It’s owned by Australia-based News Corp. The family of Rupert Murdoch (News Corp.’s chairman and CEO) controls 99 percent of Fox’s equity and almost 40 percent of its stock.
Murdoch and News Corp. ran into problems with the Federal Communication Commission’s rules concerning foreign ownership of companies using the public airways. After more than a year of investigating, the FCC unanimously ruled in July, 1995 that News Corp.’s foreign control of Fox was in the public interest. The FCC said it’s own rules had not been made clear to Fox when it was formed in 1985. Without this waiver, News Corp. could have faced payment of $720 million unpaid taxes.
Two months earlier, in May, 1995, MCI Communications Corp. agreed to invest $2 billion into News Corp. MCI is now News Corp.’s second biggest shareholder with 13.5 percent. MCI is owned by British Telecommunications.
News Corp. also owns 20th Century Fox, the London Times, publishing firm Harper & Row, and TV Guide magazine. The company also controls 40 percent of the European satellite service BSkyB and has talked of starting a similar service in Latin America.
In July, 1996, News Corp. offered to buy New World Communications Group for $2.48 billion. With the addition of the 10 Fox affiliates owned by New World, News Corp. would now own 22 Fox stations reaching 35 percent of the national viewership. Former New World chairman Brandon Tartikoff said the buyout would create “an even more vital and powerful force in television.”
One year later, in June, 1997, News Corp. purchased one-third of Primestar Partners, a national satellite-TV company that offers 220 different cable channels.
The company also purchased International Family Entertianment, parent company of the Family Channel, for $1.7 billion. Created by Christian Coalition founder Pat Robertson, the Family Channel is run by his son, Tim. Robertson was a Republican candidate for president in 1988 and appears on the show 700 Club, which shows each night on The Family Channel at 10 p.m.
“We’re looking to take the Family Channel global, and we’re looking to serve the kids market better, and there’s no better partner than News Corp.,” Tim Robertson said after the deal.
1994 Revenue: News Corp. Ltd. ADR: $8.468 billion.
1995 Revenue: News Corp. Ltd. ADR: $8.640 billion.
1997 Revenue: News Corp. Ltd.: $11.262 billion.
PBS (Public Broadcasting Service)
1329 Braddock Place, Alexandria, VA 22314
Founded in 1969, PBS is a private, nonprofit corporation whose members are the nation’s public TV stations. Unlike any other television network, PBS claims that its noncommercial programs are chosen for their value to the viewer, rather than to an advertiser.
“Public TV is a voluntary partnership among individuals, businesses, foundations, and local, state and federal governments to use television as a positive force in society,” says the network.
From October 1994 to May 1995, 94.6 million viewers in 54.4 million households watched public TV each week, according to Nielsen Television Index (NTI). This represents 57.1 percent of America’s 95.4 million households with TVs.
According to the network, the PBS budget for FY96 (July 1, 1995-June 30, 1996) of $166.98 million is paid primarily by member stations: 71.8% of the budget is provided by the stations, 13.5% comes from the Corporation for Public Broadcasting and 14.7% is from educational institutions, interest income and other sources.
Public television’s national, regional and local income in FY93 was $1.38 billion, according to the Corporation for Public Broadcasting. Four-fifths (79.6%) of the funding came from nonfederal sources.
The children’s show Sesame Street made its debut in November, 1969.
HBO (Home Box Office) and Cinemax
1100 Avenue of the Americas, New York, NY 10036
CNN (Cable News Network), CNN2, and Headline News
One CNN Center, Box 105366, Atlanta, GA 30348
WTBS (Turner Broadcasting System)
1050 Techwood Dr. NW, Atlanta, GA 30318
TNT (Turner Network)
1050 Techwood Dr. NW, Atlanta, GA 30318
The Time Warner, Turner Broadcasting Corporation is the largest media empire in the world. The Time Warner, Turner dominion includes multiple film studios, film libraries, network broadcasting stations, cable networks, cable systems, music companies, publishing firms, professional sports teams, retail store chains, home video companies, and amusement parks.
HBO was launched in 1975 by Time Inc.
Time Inc. and Warner Brothers Communications merged in 1989 to form a $14 billion company.
In October, 1995, the Federal Trade Commission began reviewing the proposed $8 billion acquisition of the Turner Broadcasting System. The deal was finally approved in July, 1996.
The largest cable owner in the United States, Tele-Communications Inc. (TCI), is a major shareholder in Turner. TCI now owns 9 percent of Time Warner, which is the second largest cable system owner in the country. Telephone and cable giant US West also owns 25 percent of Time Warner.
The alliance between Time Warner, Turner, TCI, and US West makes this company the largest media conglomerate in the world. The company’s realm encompases cable systems that serve half the subscriber population in the United States.
In December 1998, the Justice Department approved a $40 billion merger between TCI and it’s former telephone company rival AT&T. AT&T is the nation’s largest provider of wireless telephone service with about 9 million customers. TCI will have to sell off it’s stock in Sprint’s mobile telephone business, Sprint PCS in order to go through with the deal.
Time Warner Inc. not only owns HBO and Cinemax, but also Entertainment Weekly magazine,Life magazine, People magazine, Sports Illustrated,Time magazine, Warner Brothers Studios and Warner Brothers Records.
Turner Broadcasting System Inc. debuted CNN in 1980 with sponsors Procter & Gamble Co. and General Foods.
The Turner Broadcasting System includes the WTBS (which became a superstation in 1976), CNN, and TNT cable networks; the MGM/UA film library; the New Line and Castle Rock film studios; and the Cartoon Network which was launched in 1992 after Turner’s purchase of the Hanna-Barbera cartoon archives.
1994 Revenue: Turner Broadcasting System: $2.809 billion.
1995 Revenue: Turner Broadcasting System: $3.437 billion.
1994 Revenue: Time Warner Inc.: $7.396 billion.
1995 Revenue: Time Warner Inc.: $8.067 billion.
1997 Revenue: Time Warner Inc.: $13.294 billion.
1994 Revenue: Tele-Communications Inc.: $4.936 billion.
1995 Revenue: Tele-Communications Inc.: $6.851 billion.
1997 Revenue: Tele-Communications Inc.: $7.570 billion.
1994 Revenue: U.S. West Communications Group: $10.953 billion.
1995 Revenue: U.S. West Communications Group: $9.284 billion.
1997 Revenue: U.S. West Communications Group: $15.352 billion.
A new 24-hour sports network created in February 1996 through a merger between Turner Broadcasting System’s Cable News Network and Time Warner Inc.’s Sports Illustrated magazine. The network is scheduled to debut in December 1996.
1633 Broadway, New York, NY 10019
MTV (Music Television)
1515 Broadway, New York, NY 10036
1515 Broadway, New York, NY 10036
TMC (The Movie Channel)
1633 Broadway, New York, NY 10019
1515 Broadway, New York, NY 10036
Viacom Inc. owns the cable networks MTV (which launched in August, 1980), Nickelodeon, VH1, Comedy Central, Showtime (which launched in March, 1978), and The Movie Channel. It also owns publishers Prentice Hall and Simon & Schuster. In April 1994, Viacom buys Paramount Communications for $9.5 billion.
Then in September, 1994, Viacom purchases Blockbuster Entertainment for $7.6 billion. Blockbuster has more than 4,000 video stores across the country that accounts for nearly 25 percent of the market share.
In April, 1996, Viacom struck a deal with German broadcasting corporation Kirch Group to televise MTV, VH1, Nickelodeon and Paramount TV. The alliance with Kirch could bring the company $1.8 billion over 10 years. Kirch owns the second- and third-largest television networks in Germany and had revenues in 1994 of $4.286 billion.
By 1997, however, Viacom’s buying spree put the company $9.7 billion in debt. “There’s no denying we have our difficulties,” said Viacom Chairman Sumner Redstone at a May, 1997 shareholders meeting. “None of us is happy about the market value of Viacom.” The poor financial situation is mostly due to a significant slowdown in Blockbuster’s video rental business. Blockbuster’s value in 1997 is estimated at $4.4 billion, about half what Viacom paid for it three years earlier.
Viacom was also having problems with partner Seagram Co. over ownership of the USA Network. Montreal-based Seagram sued Viacom saying that Viacom’s ownership of MTV and Nick at Nite TV directly competes with USA and is a breach of their original contract. The dispute ended with Seagram buying Viacom’s half of USA for $1.7 billion, only to sell the network one month later to HSN Inc./Silver King Communications Inc.
1994 Revenue: Viacom Inc.: $7.363 billion.
1995 Revenue: Viacom Inc.: $11.688 billion.
1997 Revenue: Viacom Inc.: $13.504 billion.
USA Network and Sci-Fi Network
1230 Avenue of the Americas, New York, NY 10020
The Home Shopping Network
In October, 1997 another television colossus was born. Media giant Seagram Co. sold off part of its Universal Studios operations to HSN Inc. to create the new USA Networks Inc. The new company, run by high profile CEO Barry Diller, owns the USA Network; the Sci-Fi Network; the Home Shopping Network; TV stations owned by Silver King Communications; production of Universal TV shows such as “Law & Order,” “Hercules,” and “Xena”; and a controlling interest in the monopolistic Ticketmaster.
HSN Inc. paid $1.2 billion in cash to Universal for a 45 percent controlling interest in the company. The USA Network is viewed in 73 million homes and the Sci-Fi Network can be found in 50 million American homes.
UPN (United Paramount Network)
The network was launched on January 16, 1995 with the premier of the Star Trek: Voyager series. Created by a partnership between United Television/Chris-Craft Industries Inc. and Paramount Television/Viacom Inc. Chris-Craft owns eight television stations in some of the United States’ largest markets.
UPN provides broadcasting for four hours of primetime programming every Monday and Tuesday evening from 8:00 – 10:00 p.m. (ET/PT); a Saturday afternoon movie block; and, beginning in September, 1996, will add an hour of Sunday morning children’s programming.
The network claims it has affiliates covering more than 85 percent of all U.S. television viewing households.
1994 Revenue: Chris-Craft Industries Inc.: $481.4 million.
1995 Revenue: Chris-Craft Industries Inc.: $472.1 million.
1775 Broadway, New York, NY 10019
Comedy Central launched in 1990. Half owned by Viacom Inc. and half by Time Warner Inc. Originally a merger between Viacom’s Ha! channel and Time Warner’s Comedy Channel.
AMC (American Movie Classics) and Bravo
Woodbury, NY 11797
Both AMC and Bravo are owned by Rainbow Programming Holdings which is a subsidiary of Cablevision Systems Corporation, the fifth largest operator of cable television systems. Cablevision’s subscriber base is mostly in New York City (79.6 percent of the company’s total subscribers) and Cleveland (16.5 percent of total subscribers). Over all, Cablevision claims 2.6 million customers in 19 states.
Cablevision, which was founded in 1985, recently entered into a partnership with ITT Corporation to purchase New York City’s Madison Square Garden Properties including the MSG Network which broadcasts the Knicks and Rangers professional sports teams. Cablevision’s Rainbow Programming and ITT Corp. paid $1.009 billion for MSG to original owner Viacom Inc. in the March, 1995 deal.
ITT Corporation (1330 Avenue of the Americas, New York, NY 10019, (516) 258-1261), with 1994 sales of approximately $23.5 billion, is a multinational enterprise engaged in three major business areas: ITT Hartford Insurance, ITT Industries and ITT Hospitality. ITT has approximately 100,000 employees in 61 countries.
Through the Rainbow Holdings subsidiary, which was formed in 1980, Cablevision Systems Corp. (One Media Crossways, Woodbury, NY 11797, (516) 496-1472) owns interests in companies which produce and distribute American Movie Classics, Bravo, Romance Classics, regional SportsChannel networks and Prime Sports Network, NewSport, News 12, MuchMusic and the Independent Film Channel, as well as Rainbow Advertising Sales Company, CNI and Rainbow Network Communications. Twenty-five percent of Rainbow is owned by General Electric’s NBC division.
Rainbow Holdings boasts annual revenues of a half-billion dollars.
“The sexiest area to focus on when discussing cable is globalization,” says Josh Sapan, Rainbow’s Chief Executive Officer. “Rainbow is a major player in this global gold rush by licensing feeds of Bravo and AMC in Europe, Asia, Australia and the Americas as well as syndicating award-winning original specials, series and documentaries. Last year, Bravo was awarded one of six licenses for Canadian distribution, and launched Bravo! Canada.”
1994 Revenue: Cablevision Systems Corp.: $837.2 million.
1995 Revenue: Cablevision Systems Corp.: $1.078 billion.
600 Third Ave., 2nd Floor, New York NY 10016
Court TV was launched on July 1, 1991 by American Lawyer Media, Liberty Media,NBC and Time Warner.
The first trial shown on the network was Florida vs. Robert Scott Hill. He was acquitted of charges of murdering his step-mother-in-law more than 20 years earlier.
Nearly every state in the country allows cameras in the courtroom, with notable exceptions being South Dakota, Indiana and Mississippi.
The Discovery Channel and The Learning Channel (TDC)
7700 Wisconsin Ave., Bethesda, MD 20814
Media giant Cox Enterprises Inc. owns The Discovery Channel (which is received in 66 million homes and is co-owned with Tele-Communications Inc.), The Learning Channel, part of the E! Entertainment Network, Rysher Entertainment, six television stations (which covers 8 percent of the United States), 16 radio stations,18 daily newspapers, and several weekly newspapers. It also operates Cox Cable which (after a merger with the Time Mirror Co.) posted a 1994 revenue of $736.4 million and has 3.2 million subscribers.
1994 Revenue: Cox Enterprises Inc.: $3 billion.
Los Angeles, CA 90036
QVC, a cable shopping network which broadcasts live 24 hours a day, was started in June, 1986 by Franklin Mint founder, Joseph Segel, and began operations in November 1986. In the United States, QVC operates two cable shopping services — the original QVC, which broadcasts from West Chester, Pennsylvania, and Q2, which broadcasts from New York. The network has a sister station in the United Kingdom called QVC The Shopping Channel.
In 1995, cable operators Comcast Corp. of Philadelphia and TCI purchased QVC. Comcast’s cable service has 4.2 million subscribers making it the fourth largest in the United States. Comcast’s cellular telephone businesses are purchased by 7.5 million people. Comcast is also part-owner of the Philadelphia 76ers basketball team, Philadelphia Flyers hockey franchise, and the city’s new CoreStates Spectrum sports center. The company is also close to making a deal with the Philadelphia Phillies baseball team to create a regional sports network to televise all three teams.
The network says it reaches 54 million homes in the United States and 4 million in the United Kingdom. QVC reaches 80 percent of all U.S. cable homes, as well as 3 million satellite homes.
QVC says its sales in 1995 reached $1.6 billion. The previous year, the network says sales reached $1.4 billion.
In January, 1997, Comcast and the Walt Disney Co. purchased control of the E! Entertainment Network for $321 million. Comcast also purchased part of the Golf Channel, Speedvision and Outdoor Life.
Microsoft Corp. gave Comcast a significant cash boost in June, 1997 when it purchased 11.5 percent of the company for $1 billion.
1994 Revenue: Comcast Corp.: $1.375 billion.
1995 Revenue: Comcast Corp.: $3.362 billion.
1997 Revenue: Comcast Corp.: $4.913 billion.
CMT (Country Music Television) and TNN (The Nashville Network)
2806 Opryland Dr., Nashville, TN 37214
Owned by the Gaylord Entertainment Co. TNN, which made its debut in 1983, is now broadcast into 70 million homes. The younger CMT, which started in 1992, is received in 31.4 million U.S. homes.
The Nashville-based Gaylord owns the “General Jackson” entertainment showboat, Grand Ole Opry live country music show, Opryland theme park and Ryman Auditorium. In addition to TNN and CMT, Gaylord also operates the CMT International and Z Music cable networks, two television stations and two radio stations. The company also owns part of the Bass Pro Shops, Texas Rangers baseball team and NASCAR Thunder retail stores.
1994 Revenue: Gaylord Entertainment Co.: $687.9 million.
1995 Revenue: Gaylord Entertainment Co.: $707.5 million.
BET (Black Entertainment Television)
1900 ‘W’ Street, N.E., Washington, D.C. 20018
BET Holdings, Inc. launched the BET cable station in January, 1980 and now boasts viewership in 42.3 million households. The company says its mission is “to become the preeminent media company serving black consumers, thereby creating substantial value for its shareholders.”
The principal operations of BET Holdings, Inc. consist of cable television broadcasting and magazine publishing. The Company’s Entertainment Group operates BET Cable Network, BET Action Pay-Per View and other ancillary businesses including BET Direct, the Company’s wholly-owned direct marketing subsidiary. The Company’s Publishing Group publishes Young Sisters & Brothers (YSB) and Emerge magazines.
In 1997, BET made plans to open 20 SoundStage music-theme restaurants in black areas around the country. In June, 1997, the network spent $6.5 million to open a prototype restaurant in a Washington D.C. suburb.
1994 Revenue: BET Holdings Inc.: $97.5 million.
1995 Revenue: BET Holdings Inc.: $115.2 million.
C-SPAN (Cable-Satellite Public Affairs Network) and C-SPAN 2
400 N. Capitol St. NW., Suite 650, Washington D.C., 20001
C-SPAN is a private, non-profit business venture funded by the cable television industry. The cable systems which offer the network to their customers provide the funding. The network, which first aired in 1979, is governed by a board of directors of cable television executives who establish network policy and oversee the budget. However, this board does not put forth any editorial directives.
The network states its mission is “to provide C-SPAN’s audience access to the live gavel-to-gavel proceedings of the U.S. House of Representatives and the U.S. Senate, and to other forums where public policy is discussed, debated and decided–all without editing, commentary or analysis and with a balanced presentation of points of view.”
After the success of C-SPAN in the early 1980’s, the U.S. Senate began television its proceedings and in June, 1986, C-SPAN 2 was created to cover the daily sessions.
TBN (Trinity Broadcasting Network)
P.O. Box A, Santa Ana, CA 92711
Christian satellite network featuring programs such as “Praise The Lord.”