Viacom, MGM, Lionsgate team for new pay-TV/VOD venture

While Fox and NBC Universal focus on developing the Web as the next-generation distribution platform with their Hulu online joint venture, another group of studios announced Sunday that they will look to layer digital technology atop traditional cable and satellite platforms to create a new type of pay-TV and video-on-demand service.

The group includes Viacom Inc., its Paramount Pictures unit, MGM and Lionsgate. The service, as yet unnamed, will bow in the fall of 2009.

The new venture will have access to Paramount and Paramount Vantage titles released theatrically on or after January 1, 2008 and MGM, United Artists and Lionsgate titles released theatrically on or after January 1, 2009.

It will have exclusive access to those titles during the pay-TV window, a blow to Showtime Networks, a unit of Viacom’s one-time sister CBS, which currently has the pay-TV rights to MGM and Lionsgate films.

The two studios are not expected to renew their current contracts with Showtime when they expire at the end of this year. Paramount's contract with Showtime is also scheduled to end.

In addition, the new service will have access to unspecified “new original television series” created by the participating studios.

“This venture has the potential to be a game changer for the industry,” Viacom CEO Phillipe Dauman said in a statement. “We are building an innovative service that will use traditional and

new digital distribution technologies to bring great film and television entertainment directly to the consumer.”

Viacom will provide operational support for the new service, including marketing and affiliate services through its MTV Networks division.

“At MGM, we are very pleased to have found two partners that share our vision of providing first-run movies and premium-quality original television programming across linear and digital platforms in a new way,” MGM chairman/CEO Harry Sloan added. “Our approach delivers unique flexibility for program distributors as well as consumer options that will provide the highest quality entertainment.”

Officials from the various companies were not immediately available Sunday to elaborate on the promised new distribution strategies.

The full press release is available here.