NBC May Launch Own News Cable Network

National Broadcasting Co. may launch an all-news cable-television network to compete with Ted Turner’s Cable News Network, NBC News President Lawrence K. Grossman told The Times on Friday.

The network quietly began soliciting reaction to its plans earlier this week during a meeting of its television station affiliates’ board in New York.

The NBC cable news project is still in the exploration phase, Grossman said, but a firm decision will be made before the end of the year. He said that he has held informal discussions with a few operators of cable-TV systems and believes that there is room for “competition in what has become a major part of the news business.”

“We have been working for the past month or two on exploring the prospects of opening up a cable news channel,” Grossman said. “We’re testing the waters at this point. We are looking into it, and we are looking into it seriously.”

Grossman cautioned, however, that “I regard the chances of doing this as a long shot.”

If NBC decides to launch a new service, it will be the second attempt by one of the major national broadcasting networks to compete with Turner’s 5-year-old Cable News Network service.

Satellite News Channel, a joint venture of American Broadcasting Cos. and Group W (Westinghouse) Broadcasting & Cable, failed two years ago after a heated and unsuccessful effort to counter Turner’s cable news monopoly.

Turner paid ABC and Group W $25 million for the Satellite News operation and closed it down.

Through a spokesman in Atlanta, Turner said of the proposed NBC venture: “Cable’s strength is its diversity of programming choices, and we welcome newcomers to the industry. However, we would suggest to NBC that music-video channels are easier and more profitable to operate than all-news networks.”

Turner’s Cable News Network, which has never turned a profit, is available to more than 32 million homes across the country. Its companion news channel--CNN Headline News--is distributed to about 15 million cable-TV households.

NBC’s Grossman declined to discuss specifics of the cable news plan but suggested that it will utilize the network’s existing overseas news operations, the news facilities of NBC’s more than 200 affiliated TV stations and the network’s relatively new satellite distribution system.

Current union rules, Grossman said, may prohibit using NBC personnel, and he does not expect that NBC’s current on-air correspondents will appear on the proposed cable news channel.

“I look upon this as a wholly separate enterprise,” Grossman said.

RCA Operates Satellites

NBC was the only broadcasting network not to launch a major cable programming effort in the early 1980s, although its parent company, RCA, has long operated the principal satellites that distribute national cable networks and is a leading supplier of equipment to local systems.

Grossman would not discuss how many cable subscribers the new network would require to be profitable. He said, however, that the current business climate of the cable-TV industry may be more conducive to a competing news channel than it was at the time of the ABC-Group W venture.

Especially favorable today may be the cable industry’s own growing dissatisfaction with Turner’s operation as he has devoted more financial resources and energy to ventures outside of his core business. Most notable among those efforts have been Turner’s recent unsuccessful effort to buy CBS and his $1.5-billion bid last week for Culver City-based MGM/UA Entertainment Co.

Industry Speculation

There has also been persistent speculation within the cable industry that Turner plans to launch a direct-broadcast satellite service that will compete directly with local cable operating companies.

Cable systems have also voiced dissatisfaction with a series of rate increases that Turner Broadcasting System announced for Cable News Network earlier this year. Cable operators now pay a monthly average of 18 cents per subscriber for Cable News Network, a Turner spokesman said, and Turner plans a 3-cent rate increase as of Jan. 1. A second increase has been announced for Jan. 1, 1987.

Presumably, any NBC news channel would be offered at a lower per-subscriber rate than Turner’s. Cable industry officials suggested that any new news venture would require about 13 million subscribers to start and would cost about 15-cents per home.