With enhanced underwriting, videotape sales and even a for-profit telecommunications arm, public television is no stranger to the world of commerce.
Now executives at the Public Broadcasting Service and two of its major stations are exploring a joint venture to launch a cable TV service with the Discovery Channel. They say the proposed educational service would provide income from subscribers and allow public-television programmers to reach out to the desirable cable audience.
The venture will most likely be a for-profit operation, with start-up funding provided by Discovery, PBS chief operating officer Neil Mahrer said in an interview Wednesday. PBS and stations WGBH in Boston and WNET in New York would provide programming during the day, and Discovery--presumably with another partner--would control the nighttime hours.
The programs would be strictly educational, Mahrer said, such as language classes or preparation for a high school equivalency test. The channel would not run cultural or public-affairs programs.
Under their agreement with Discovery, PBS and the two stations are conducting a feasibility study, which is scheduled for completion Sept. 9.
From PBS' point of view, setting up the channel would be very desirable, and the information gathered so far indicates that the project will continue, said Mahrer, who was in Los Angeles to meet with television critics and reporters.
The Discovery Channel declined to comment, except to confirm that the feasibility study was being conducted. In an earlier statement, the company said it was looking for the best way to put educational programming on cable.
Even though the proposed channel probably would be for profit, there would be no commercials during the hours programmed by PBS, Mahrer said. There would, however, be "enhanced underwriting," the method for identifying program underwriters that describes their businesses or uses their slogans instead of simply mentioning their names.
Funding for the programs would come from anticipated profits and from PBS' traditional funding sources. In the event that profits don't cover the cost of producing the programs, the new channel would be competing with the network's cultural and public-affairs shows for a piece of the PBS budget pie, Mahrer said.
Bill Rosendahl, vice president of operations for Century Cable in Southern California, said that as local cable systems expand, they will be looking for new channels to run. At Century Cable, which serves Santa Monica and much of Los Angeles, a joint Discovery/PBS project would likely be a welcome addition.
"I personally consider PBS to be one of the finest news and public-affairs organizations in the country, and the Discovery Channel is one of the very best basic cable services," Rosendahl said. "Anything they provide I will look at with great interest."
If the channel becomes part of basic cable service, as PBS hopes, it will receive fees from cable operators ranging from 3 cents to 15 cents for each subscriber.
"We feel its very important to be entrepreneurial, and, as funny as it may sound, from its inception public television has been entrepreneurial, simply because of its need for funds," Mahrer said.
"It's also important in terms of being in the programming business to get into these various forms of distribution," Mahrer said. "When we don't have the capital to invest in the start-up, we have to get even more entrepreneurial."
In its efforts to sell videotapes, PBS went into partnership with distributor Michael Nesmith, who has so far provided more than $1 million to set up the for-profit operation, PBS Home Video, Mahrer said.
In both the home video and the cable ventures, PBS expects to keep its nonprofit status, Mahrer said. According to the Internal Revenue Service, public television may engage in for-profit activities without paying taxes as long as the money is reinvested in a way that serves its not-for-profit purpose.
In the case of the proposed cable channel, PBS and the two stations would most likely set up a separate, not-for-profit company that would control their equity in the channel, Mahrer said.
"Sure, it's corporate," Mahrer said in response to reporter's questions about the cable venture. "But it's also time for public television to get out of the politics of poverty."