TCI to Help Fox Launch Into Cable : Entertainment: Sources say TCI will pay up to $30 million a year and provide space on its system for permission to retransmit Fox programs.

Tele-Communications Inc. will help Fox Broadcasting launch a long-planned cable TV network by providing Fox with up to $30 million per year and guaranteed slots on cable systems serving 10 million viewers, people familiar with the plan said Friday.

The agreement is one outcome of complicated new cable regulations that require cable operators to negotiate with broadcasters over carrying local TV stations’ signals.

Under the new rules, the owners of local TV stations have until June 17 to select one of two options in their dealings with the operators of local cable systems.

The “must carry” option guarantees stations a spot on local cable systems, but the broadcasters cannot collect a fee from the cable operator. Opting for “retransmission consent” frees the broadcaster to seek payment from cable systems. But if the parties cannot reach an agreement, the cable operator can drop the TV station from its lineup.

Several of the country’s biggest cable operators, however, say they will not pay broadcasters for the right to retransmit their signal--up to now, a major source of programming that operators have received for free.

In that refusal are the origins of the TCI-Fox deal.

The cable operators’ defiant stance is compelling the TV networks and local broadcasters to find inventive ways to secure “retransmission consent.” Fox’s apparent strategy: asking for a second channel on cable systems instead of cash and sharing the take with its local affiliates.

Under the TCI-Fox plan, sources said, TCI would pay Fox Broadcasting about 25 cents per month for each of TCI’s approximately 10 million cable TV subscribers--about $30 million per year.

Fox, in turn, would pay its affiliates either 7.5 cents per month for each cable subscriber in their market--or 5 cents, plus participation in 25% of the cable channel’s profit.

Fox would retain the rest of TCI’s investment to help finance operation of the new cable channel, which would carry a mix of original and repeat programs. Fox affiliates--many of which are UHF stations--would be guaranteed a channel between 1 and 13 on participating cable systems.

Fox and TCI declined comment.

The plan essentially has TCI bankrolling and providing the necessary subscribers to launch Fox’s long-planned cable channel. Presumably Fox would be able to strike similar deals with other cable operators, since TCI is the standard bearer for much of the industry.

One potential hurdle, however, could be the Fox affiliates. Some Fox stations may not want to see the network starting a competing channel in their back yard. Other affiliates may prefer to negotiate their own retransmission deals with local cable operators.