Time Warner Cable said Wednesday that it signed a five-year affiliate deal
with Tribune Media Services to license the company's Zap2it passive electronic
program guide.
Gemstar TV Guide International Inc. currently dominates the passive-guide
market with its TV Guide Channel. The deal could give the MSO and parent AOL
Time Warner Inc. some leverage in its broader talks with Gemstar about licensing
its TV Guide Interactive interactive program guide.
Time Warner spokesman Mike Luftman said it's premature for the MSO to comment
on when it may deploy Zap2it, which systems would launch the guide or how many
subscribers may get Zap2it.
Tribune Media Services EPG products general manager John Kelleher said Time
Warner has tested the Zap2it guide 'in a couple of beta sites.'
The MSO also declined to say how many subscribers currently receive TV Guide
Channel. But it's well known that Time Warner offers Gemstar's EPG in many
markets, including its flagship New York City system.
'I will be surprised if [Time Warner] replaces [TV Guide] Channel with
Zap2It. Consumers love and trust TV Guide as the authority on listings and
entertainment information,' Gemstar co-president Peter Boylan wrote in an
electronic-mail exchange Wednesday afternoon.
Boylan also said Time Warner officials told Gemstar they have 'total
flexibility' in their deal with Tribune.
The agreement marks the first MSO deal Tribune has secured for the Zap2it
guide.
Zap2it is a scrolling guide, similar to TV Guide Channel. A key difference is
that Gemstar controls the video window, in which it sells advertising and keeps
most of the revenue.
Zap2it gives the operator complete control of the video window, which they
can use as a barker channel, to sell local advertising or to offer local news
programming or community information, TMS director of business development Jay
Fehnel said.
Tribune's entrance into the guide market follows the emergence of the
TVGateway IPG consortium, which was formed by WorldGate Communications Inc., Cox
Communications Inc., Comcast Corp. and Adelphia Communications Corp. last
summer.
The MSOs said they formed TVGateway to bring competition to the guide market.
Gemstar recently signed Charter and Comcast to long-term licensing deals to
offer TV Guide Interactive to the majority of their subscribers, but the
agreements are not exclusive.
Boylan has said in the past that a broad license America Online Inc. signed
with Gemstar in 1999 would force Time Warner to replace IPGs from
Scientific-Atlanta Inc. and Pioneer New Media Technologies Inc. with TV Guide
Interactive. Gemstar is in active talks with AOL Time Warner on the issue,
Boylan said in a conference call last week.
Kelleher acknowledged that Time Warner could be using TMS to gain leverage in
its talks with Gemstar, but he said he has no problem with that.
'They are going to use us as leverage. If you look at the history, that's
what they do with programmers and everyone else. We think being used as leverage
will help us to deploy,' Kelleher said.
TMS hopes to eventually secure 20 percent of the U.S. passive-guide market,
he added.
