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Comcast, Gemstar-TV Guide Ink Long-Term Pact

Under a comprehensive joint venture and carriage deal, Comcast Corp. will pay Gemstar-TV Guide International Inc. a $250 million fee as they partner to form an interactive-program-guide-development group and the MSO agrees to rollouts of TV Guide On Demand and TVG Network.

For its one-time $250 million payment, Comcast is entering into a long-term, nonexclusive patent-license and distribution agreement to use Gemstar-TV Guide’s intellectual property and technology, as well as the TV Guide brand and content, on its IPGs.

The joint development group -- which will be 51%-owned by Comcast and 49%-owned by Gemstar-TV Guide -- will use the existing TV Guide Interactive IPG as a foundation to create a cutting-edge guide for Comcast, as well as other cable operators.

Overall, the expansive pact is meant to give Comcast flexibility and control, permitting it to deploy the IPG created by the joint development group or guides developed by third parties, while extending the reach of Gemstar-TV Guide’s content and brand.

Under their licensing agreement, Comcast will incorporate TV Guide branding into the majority of its IPGs. Gemstar-TV Guide will provide operational support for the jointly developed guide on Comcast’s systems, as well as continuing to supply Comcast with TV Guide listings data.

Comcast and Gemstar-TV Guide also entered into a carriage agreement that supercedes their former 20-year deal and covers TV Guide Channel, TV Guide On Demand and TVG. TV Guide Channel is currently carried on most of Comcast’s systems.

In addition, TV Guide will provide Comcast’s video-on-demand-enabled subscribers with TV Guide On Demand, and the MSO will launch TVG on some of its systems.