The television industry's wave of consolidation joined another pair of household names yesterday, NBC and the family-friendly Pax television network. Under the deal, NBC movies, miniseries and other programs are to show up as reruns on Pax stations.
NBC said it agreed to pay $415 million for a 32 percent stake in Paxson Communications Corp., owner of the new network, with rights to increase that to 49 percent and take operating control after Feb. 1, 2002, if federal ownership rules are relaxed.
The deal would give NBC two outlets in many U.S. cities, including the Washington area, where WRC-Channel 4 carries NBC shows and Pax has WPXW, Channel 66.
Competing for viewers with other broadcast stations, cable and the Internet, NBC sees the Pax deal as a way to attract more viewers to programs that are enormously costly to acquire. The deal "fulfills NBC's desire to have a second entertainment network," Paxson chairman Bud Paxson said in an interview. "And with this money, we get to build out our digital platform."
Paxson, like most of the rest of the broadcast industry, hopes to convert its stations to new digital formats, which will open up many new channels. The money Paxson will collect also will help it acquire new stations.
Pax is among a crop of new networks launched in recent years. Its lineup stresses reruns of wholesome shows such as "Touched by an Angel" and "Eight Is Enough," as well as originally produced material such as "Flipper: The New Adventures." Bud Paxson said yesterday that for the immediate future, that programming philosophy will continue.
Though it's an infant, Pax has built national reach. Counting pending acquisitions and construction, the network has an economic interest in 72 stations and counts 51 others in its network. Together, their signals can reach 76 percent of the viewing public.
Under the deal, NBC and Pax stations could also cross-promote each other's shows and share costs. In Washington and Providence, the deal calls for joint sales agreements between station pairs. The deal was made possible by a loosening of Federal Communications Commission rules barring a company from owning more than one station in a community.
Though it could get NBC shows to more viewers, the network remains the odd man out among the big four in having no programming affiliate. ABC is part of the Walt Disney Co., which has studios, while the Fox network draws on in-house programming. CBS last week struck a deal to be acquired by Viacom Inc., which would give it production capability as well as two stations in some cities.
Staff writer Tim Smart contributed to this report.
CAPTION: Chairman Bud Paxson says Pax will remain family-friendly.