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ANDREA FIGLER
Expanding News Corp.'s cable operations will be part of the plan for Brian Mulligan, the new chairman of Fox Television.
Mulligan will also oversee the Fox Television stations and Fox Sports.
Formerly CFO at Seagram and co-chairman of Universal Pictures, he reports to News Corp. president/CEO Peter Chernin and replaces Chase Carey, who became president/CEO of Sky Global Networks last year.
"Few entertainment executives possess as rich a combination of financial know-how, creative sensitivity and deal-making acumen as Brian," Chernin said in the announcement. "We feel extremely fortunate to have attracted a person of Brian's caliber to run Fox Television."
Fox Cable Networks Group manages Fox Sports Net, FX, Fox Family Worldwide, Fox News Channel and - as of last week - The Health Network.
In a unique financial deal, News Corp. last year gave WebMD a 50% stake in The Health Network and received in return 50% ownership in an international joint venture with the online health service company. Due to changes in strategy for WebMD, the deal was essentially reversed last week.
Now News Corp. owns 100% of the health cable channel, a wholly owned subsidiary managed by the Fox Cable Networks Group, says Tom Tyrer, SVP-corporate communications for the group. The Health Network is broadcast in 20 million homes through cable operators such as Adelphia, Cablevision and AT&T. Direct broadcast satellite provider DirecTV also airs the network.
While the change in ownership shouldn't significantly affect the network, News Corp. will probably lose at least another $10 million by taking full control, a Banc of America Securities analyst says. The network lost about $20 million in operating costs last year and should continue at the same pace this year, research analyst Patrick Hojlo says.
The unraveled WebMD deal makes News Corp. take full responsibility for all marketing and operating costs once again, an extra expense that could put extra pressure on News Corp.'s debt rating. Credit rating agency Standard & Poor's revised its outlook to negative on News Corp.'s BBB-minus corporate bonds last month due to increased financial pressure.
S&P analyst Heather Goodchild says she'll closely watch every deal struck by the company after News Corp. was forced to buy out Fox Family Channel's CEO Haim Saban's 49.5% stake in the channel last month. The cost of Saban's stake plus that channel's $1.5 billion debt load would severely dampen News Corp.'s ability to pay back its debt and threaten to turn its outstanding bonds into junk.
The added $10 million in operating costs for The Health Network, however, should not significantly burden the media giant's corporate debt rating further, other analysts agree.
"It's less of a financial decision and more of a strategic decision," Hojlo says of WebMD's push to sell its stake in The Health Network.
Whatever happens, News Corp. hopes Mulligan will help steer the company away from junk bond territory.
"At each step in his career - at Universal Studios, Universal Pictures, and most recently as chief financial officer of Seagram - he has excelled at managing complex financial functions and operations while advancing the company's strategic and creative goals," News Corp.'s Chernin said in a statement.
WSNet teamed up with Ashe County Cable TV, a cable operator in Fleetwood, N.C., to offer subscribers a privately branded direct-to-home digital satellite television service using WSNet's satellite programming technology. The agreement marks the official entry of WSNet, formerly involved exclusively in providing satellite television solutions to private cable firms serving multi-dwelling units, into the small and rural franchise cable market. Other terms of the agreement were not disclosed.
America Online said it signed up more than 56,000 new subscribers in the United States and 14,000 international users on Christmas Day, a record for the Internet service provider.
What's it all about, this Alfy.com? Games, and plenty of them. Sure, there's educational stuff, too. But it's the animated games that attract kids and kid wannabes, ranging from old fashioned arcade-type spaceship shoot-em-ups to baseball to smack the gopher on the head. The games generally take two or three minutes to play, ideal for short attention spans. Alfy.com, which bills itself as The Kids' Portal Playground, also allows your kids to record their own xylophone music and draw pictures.
If they get bored enough, they might even try one of those math games.
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