Nets flexible on VOD

Broadcast-network executives said Tuesday that they expected to be flexible with cable operators' video-on-demand plans, adding that they would gradually give
them good-quality product to sell on their systems.

Fox chairman Peter Chernin said he is giving Cablevision Systems Corp. the right to
sell Fox Broadcasting's 24 and FX's The Shield to VOD customers
immediately after new episodes debut.

"What we felt is that we have very unique shows. We'll use VOD as a
promotional platform," Chernin said.

This is only a test, but it starts to break the logjam in VOD. Studios and
networks don't want to give cable operators good TV product on workable terms
for fear of setting a bad precedent.

While movie-studio chiefs are paranoid about VOD cannibalizing their DVD
sales, network heads are intrigued about reselling their TV product in a
package for cash.

ABC president Bob Iger said it was important that "we fuel the fire a little
bit with VOD." But he doesn't want ABC shows simply given away. "We want to
migrate slowly toward a VOD program and get paid for it," he added.

But Fox is willing to roll the dice a bit. Because Cablevision's digital
rollout has been plagued with software problems, VOD is only available in 25,000
homes. Fox stations face little risk of ratings siphoning.

Cablevision, in turn, has agreed to run hundreds of promos for the shows on
networks like VH1 and MTV: Music Television.

"We get value for it," FX president Peter Liguori said.

Both shows are co-produced by Fox Television.