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2008 CABLE SHOW: MGM HD Lands Time Warner Cable Deal

New Orleans-- MGM HD has closed its third major carriage agreement in the past week, locking up a deal with Time Warner Cable, officials said Sunday.

The Time Warner affiliation agreement comes on the heels of MGM HD securing carriage pacts with Comcast, the nation’s largest cable company, and Dish Network, all during the past seven days. Dish Network launched MGM HD last Monday as one of 22 HD networks the satellite provider is adding to its channel lineup.

“With our deals with Time Warner Cable and other leading cable companies, MGM HD has gained tremendous momentum and is ideally poised and ready to capitalize on the opportunities for HD content across the U.S. marketplace," said Douglas Lee, MGM’s executive vice president of Worldwide Digital Media, in an interview at The Cable Show '08 here.

MGM HD, an HD-only service from Metro-Goldwyn-Mayer Studios Inc., launched last October when DirecTV rolled it out as part of an HD mini-pay tier. For $4.99 per month, the DirecTV HD Extra Pack includes five HD-only services. Dish Network is also offering MGM HD on an HD-tier, its DishHD Ultimate offering at $10 a month.

For the first time ever, this year MGM HD has a booth at The Cable Show, where it has a 103-inch HD TV set on hand to demonstrate the network. MGM HD, backed by a library of more than 4,100 films, claims it is only one of handful of HD networks to offer content in true 1080i, 24/7.

Lee declined to disclose how many subscribers MGM HD has, but said, “We’re really growing and we’re exceeding our expectations. We’re ahead of our business plan.”

The service now has affiliation agreements with the four largest U.S. distributors: Comcast, Time Warner, DirecTV, Dish Network. It also has a pact with Verizon, which will launch it later this year on all its FiOS TV systems. MGM HD also has a carriage contract with RCN, and a number of smaller cable operators.

“MGM HD will help attract new HD customers to Time Warner Cable and will also give our existing HD customers access to an even wider array of high-definition entertainment programming," Melinda Witmer, Time Warner’s executive vice president and chief programming officer, said in a statement.

Comcast is a 20% owner of MGM, but Lee said that MGM HD didn’t get any favorable treatment as a result of that relationship.

Comcast's HD customers will be able to get classic and contemporary films from MGM on both Comcast's linear lineup as well as its video-on-demand service, which offers more than 10,000 selections each month.

MGM HD is well-positioned, in that sports and movies are two genres that lend themselves to HD, according to Lee. And the fact that DirecTV has made an extensive HD lineup its big selling point has forced other distributors to beef up their HD offerings, he said, opening up an opportunity for MGM HD.

“For the last 20 years, MGM has wanted to launch a channel domestically,” Lee said. “I think we caught the perfect storm with HD….We have a fantastic proposition. We have branded movies.”

Programmers with standard-definition networks typically offer their HD simulcast services to distributors for free, but as an HD-only channel MGM HD charges a license fee. That is why DirecTV has put its HD-only networks on a mini-pay tier with an extra fee.

“Of course, we want to get in front of as many subs as we can, because we built this thing to be an ad-supported service one day,” Lee said. “But right now, we’re just trying to get the distribution where we can. I think there’s a feeling amongst a lot of the operators that over time, just like with digital, these tiers will kind of melt away. So I think that’s our hope.”

 For more news from NCTA's The Cable Show '08, click here.