NEW YORK -- MTV Networks Inc., the original rock music channel, purchased Ted Turner's month-old Cable Music Channel for $1 million and will pipe MTV videos to Turner's 350,000 subscribers.
The agreement with Turner Broadcasting Systems Inc. for 'certain assets' of the channel also calls for MTV to buy $500,000 worth of advertising time on other Turner networks, such as Cable News Network. The sale was announced Wednesday.
MTV Music Television, which already reaches 24.2 million homes, will begin sending its programming of youth-oriented rock to the Cable Music Channel's 350,000 subscribers when the network ceases operation at 11:59 p.m. Friday.
'We simply have not had enough support from the cable industries for it (the music channel) to become a viable part of our business,' Turner said in Atlanta.
'We are very disappointed but we feel that the discontinuance of the service now and the sales arrangement with MTV Inc. are in the best interest of the company,' he said.
The takeover eliminates competition among rock channels but industry observers said another new music channel, Discovery Music Network, will challenge MTV in January.
Discovery is expected to have an audience of nearly 12 million households. Unlike MTV, which reaches households via cable television, Discovery will be relayed through a national network of UHF stations.
The Cable Music Channel, which began transmitting 24 hours a day Oct. 26, had been troubled by the disclosure it inflated its subscription base by nearly 90 percent and by restrictive credit agreements.
The channel initially claimed it would have 10 million subscribers. Cable Music Channel revised the figure to 5 million and then 2.3 million at the time it began airing, said Turner Broadcasting spokesman Arthur Sando.
The company ultimately revealed a clientele of 350,000 households, Sando said.
Turner's music channel also was endangered by credit agreements restricting its losses to levels far below those he conceded were inevitable.
