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Dec 19, 2001  •  Post A Comment

Posted Wednesday, Dec. 19, at 12:15 p.m. (PT); last updated at 5:50 p.m.

Comcast to acquire AT&T Broadband

In a deal worth $72 billion in stock and debt, Comcast Corp. will acquire AT&T Broadband, creating the country’s largest cable operator — serving more than 22 million subscribers in 17 of the 20 largest markets and passing 38 million homes.

The decision came from the AT&T Corp. board late Wednesday after a grueling auction that began when AT&T rejected Comcast’s $45 billion bid for the cable unit last summer. Comcast edged out AOL Time Warner and Cox Communications.

AT&T Corp. Chairman Michael Armstrong, who spent $120 billion acquiring leading cable systems to become the dominant player in the field, will be chairman of the merged company, to be called AT&T Comcast Corp. Mr. Armstrong had planned to retire from AT&T in 2003 after the second dismantling of the company.

Comcast CEO and President Brian Roberts will be CEO of the new combined company. AT&T shareholders will have a 56 percent economic stake and a 66 percent voting stake in the new company. They must vote to approve the deal at a special meeting next spring. The deal may take up to a year to close. Microsoft Corp. has agreed to convert its $5 billion investment in AT&T to an equity interest in the new cable company, contributing to a stronger balance sheet. AT&T yielded to Comcast’s aggressive bidding largely because it is in dire need of cash to reduce its formidable $60 billion-plus debt.

The new company will assume nearly $23 billion in AT&T debt and other liabilities. It will retain AT&T’s 25 percent stake in the troubled Time Warner Entertainment partnership, which AOL Time Warner has been trying to unravel. Mr. Roberts said he will eventually sit down with AOL Time Warner to discuss what to do about its TWE stake, which it could trade for services, subscribers or other interests. He said the new merged company will tap AT&T’s telephony expertise to quickly provide telephony service to customers as part of digital cable’s video, data and voice triple-header killer application.

Some analysts expect the proposed combination to meet with regulatory resistance. However, Mr. Armstrong and Mr. Roberts said Wednesday they expect government approval in response to the ability of the merged company to provide a full complement of new digital services to more people, more quickly and more assuredly.

In an interview on CNBC late Wednesday, Mr. Roberts said he is “grateful” and “jubilant” about the deal, and said that it took “courage” for Mr. Armstrong to recommend the sale of the Broadband unit rather than retain and spin it off, as originally planned. Both men denied reports that they have had bitter differences over the nearly yearlong, sometimes turbulent courting process.

“The rumors that we did not get along are unfounded,” Mr. Armstrong said. Ironically, Comcast will be acquiring the MediaOne Cable systems, the bidding for which it lost to AT&T several years ago. AOL Time Warner will now need to negotiate with the new cable behemoth for carriage of its AOL Internet service and other related services.

Mr. Roberts made no commitment to retaining the new management team AT&T recently put into place at the Broadband unit. AT&T and Comcast executives will meet Thursday morning with analysts and the media to discuss the deal.

Couric renews at NBC: After much speculation about her future career direction, “Today” co-host Katie Couric has renewed her contract with NBC for 41/2 more years in a deal that will bring the 43-year-old news personality an estimated $60 million to $65 million through 2006.

Ms. Couric has been co-hosting “Today” since she replaced Deborah Norville in April 1991. Since the departure of executive producer Jeff Zucker a year ago, the top-rated show has experienced a ratings decline in favor of “Good Morning America,” a situation that has worsened since the terrorist events of Sept. 11.

Ms. Couric had been romanced by other suitors, including CBS and AOL Time Warner, which proposed a number of projects, including an “Oprah”-like talk show.

Ms. Couric told the Associated Press that she would probably stay on “Today” for the duration of the new contract and that there is flexibility for her to undertake other network projects.

WB juggles Friday lineup: The WB announced it is going to shuffle its Friday night sitcom lineup, swapping its 8:30 p.m. and 9:30 p.m. (ET) time slots between freshman comedies “Maybe It’s Me” and “Raising Dad” beginning Jan. 4. In the new configuration, “Raising Dad” will be moving an hour earlier to an 8:30 p.m. start, while “Maybe It’s Me” will move up to 9:30 p.m., getting a showcase lead-in from The WB’s breakout “Reba” sitcom at 9 p.m.

In another scheduling move, The WB is adding repeat airings of its vampire-themed “Angel” leading into its witchy drama “Charmed” as part of its 8 p.m.-to-10 p.m. Thursday lineup beginning Jan. 10 and running through February. “Angel,” which will continue to air in first-run episodes at 9 p.m. to 10 p.m. Mondays, is being brought in temporarily to replace The WB’s low-rated “Popstars 2” reality series and repeats of “Maybe It’s Me,” which previously airing in 8 p.m.-to-9 p.m. Thursday time slots.

The first four episodes of “Angel” to air on Thursdays will be part of a four-show arc that concluded the series’ second season last year. Angel (David Boreanaz) and his crew have traveled to the demon dimension of Pylea, where Angel was able to venture out into the daylight.

Boston Pops joins Super Bowl lineup: Fox and the National Football League announced that the Boston Pops symphony, led by conductor Keith Lockhart, will perform during a Super Bowl XXXVI pregame show from New Orleans on Sunday, Feb. 3. Additionally, the Boston Pops will team with singer Mariah Carey to provide her rendition of the National Anthem. Other pregame performers, including two artists to do “America The Beautiful,” will be announced later.

The Boston Pops pregame show program also will feature two works by American composer Aaron Copland — his “Fanfare for the Common Man” and excerpts from “A Lincoln Portrait.”

The rock group U2 will perform during the “E*Trade Super Bowl Halftime Show” on Fox, which learned this week that NBC is counterprogramming the football intermission and postgame with Playboy Playmate-themed “Fear Factor” episodes.

DuPont-Columbia journalism awards announced: The prestigious Alfred I. duPont-Columbia University Awards for outstanding television and radio news have been announced. For 2001, they include national TV reports from ABC and CBS News, Court TV and PBS.

The local TV winners are WABC-TV in New York City for a series of reports illustrating the vulnerability of naval bases on the East Coast; KCBS-TV in Los Angeles for a series of reports about the hazards of lead paint in Southern California schools; KOLD-TV in Tucson, Ariz., for a two-part investigation of why local police patrol cars, made by the Ford Motor Co., often explode when hit from behind; and KIRO-TV in Seattle for a one-hour documentary examining the causes of whale deaths in Puget Sound.

The national TV winners are:

ABC News, Terence Wrong and Peter Bull for “Hopkins 24/7,” six one-hour documentaries about doctors and patients at Johns Hopkins Medical Center in Baltimore.

CBS News, “60 Minutes,” Steve Kroft and Leslie Cockburn for “America’s Worst Nightmare,” a report about the dangers of the Taliban and Islamic militants that aired 11 months before Sept. 11.

CBS News, David Martin and Mary Walsh for reporting on national security on “The CBS Evening News” and “60 Minutes II.”

CNN, Nic Robertson and Jonathan Miller for “Northern Ireland: Dying for Peace,” a one-hour documentary.

Court TV for “The Interrogation of Michael Crowe,” a one-hour documentary focusing on the tactics used in the police investigation and forced confession of a 16-year-old boy charged with murdering his sister.

Palfreman Film Group, “Frontline”/”Nova” and WGBH-TV, Boston, for “Harvest of Fear” on PBS, a two-hour “Frontline” and “Nova” collaboration about genetically modified agriculture and its glob
al consequences.

“CBS Evening News” and Steve Hartman for “Everybody’s Got a Story,” a continuing series of feature stories about ordinary Americans.

Mag Rack to develop new video magazines: Mag Rack, Rainbow Media’s video-on-demand service for hobbyists and other defined-niche enthusiasts, is developing new video magazines in conjunction with Primedia’s American Baby, Automobile, Hot Rod and Motor Trend magazines. The new offerings, joining Mag Rack’s 18 existing “video magazines,” will target parents of young children and auto enthusiasts.

The two companies will co-brand and cross-promote the VOD service and the Primedia magazines, and will co-develop new Mag Rack programming, using the magazines’ editors as hosts and content advisers. Mag Rack, which launched on Cablevision in the New York area in September, also will license content from Primedia’s library of niche videos.

WGN-TV to televise Roses parade in hi-def: Tribune-owned WB affiliate WGN-TV, Chicago, will broadcast the Tournament of Roses Parade live on New Year’s Day in high definition for the first time on WGN-DT, Channel 19. The parade feed will be from sister station KTLA-TV, Los Angeles.