Turner Buys New Films for Cable Broadcast

NEW ORLEANS — In the latest sign of how Time Warner will use Warner Bros. to strengthen its newly acquired cable network, Turner Broadcasting System acquired a package of 12 movies from the studio Wednesday, including three films still in theaters--”Space Jam,” “Mars Attacks!” and “Michael.”

Terms of the purchase were not disclosed by Turner, which was bought by Time Warner last year, but the deal sent nervous ripples through the broadcasting community. While reruns of several network hits such as “The X-Files” are airing on cable, rather than a broadcast channel, these are some of the first major movies to be sold directly to basic cable after their box-office run, rather than premiering on the major broadcast networks.

CBS was one of several network bidders that lost out to Turner, which plans to air the movies on its TNT and TBS cable networks beginning in either 1999 or 2000, a faster-than-usual move from theaters to basic cable.

CBS President Peter Lund questioned the economics of the deal, pointing out that Time Warner would have to account for the expense on Turner’s books while forgoing a third-party payment. After airing on cable, the movies may be sold to the broadcast networks, but at a much lower price than they would have received for the exclusive premiering. Ted Turner, vice chairman of Time Warner, said the purchase takes basic cable to a new level in its fight for viewers.

“We are taking basic cable to the stars,” Turner said, speaking in New York in a teleconference interview at the annual convention of the National Assn. of Programming Executives in New Orleans.

Turner Broadcasting also gained premiere rights to 31 pictures from Castle Rock Entertainment and Turner Pictures, units of Turner before the merger.

Disney decided to air “The Lion King” on ABC during November sweeps after it acquired the network last year. That decision broke a longtime precedent, as Disney had kept its cartoon blockbusters off broadcast television.

Ted Turner also said Wednesday that he’d like to see Time Warner’s languishing stock price rise. But the company’s largest shareholder noted the limits of his position.

“Remember, I’m the vice chairman. Jerry’s the chairman,” he said, referring to Gerald Levin.

The programming deal represents the second major venture to blend the strengths of Time Warner and Turner Broadcasting. The first was the launch last month of the CNN-SI sports news network.

“It’s a good example of the new Time Warner with Turner,” said Tom Wolzien, a media analyst at the Sanford C. Bernstein & Co. brokerage firm. “You have both content and distribution.”

Turner, also a Time Warner board member, suggested more such deals may be in the works.