Fox Reaches Deeper Into Reality

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Reality television -- it's everywhere. And even though the genre isn't so much a documentary of "real" people as it is a showcase for improvisational theater, audiences don't seem to mind (and, heck, even if they do mind, it doesn't matter; since these shows are relatively economical to produce, they're going to be around for a long time).

Now comes word that Fox (NYSE: FOX) wants to stake a claim for a chunk of cable/satellite real estate dedicated to the reality genre; the channel will be operational in 2005 (it should be noted that the new Fox channel won't be the first foray into this area, as a couple of reality networks already exist). Judging from the release, not only will we see reruns (peppered with extras, like DVDs) of current hot reality shows such as The Apprentice, which airs on General Electric's (NYSE: GE) NBC, but we'll also be inundated with a plethora of new concepts.

Let me tell you something: We are going to get every conceivable exploitation of every possible angle on every idea that can/will exist. Boring nerds in the chess club battling it out in the jungles of the high school halls with the boring nerds of the computer club... done. Boring nerds in the astronomy club trying to score with the nubile cheerleaders during gym class... done. Boring nerds in the reality-network fan club attempting to steal the nubile cheerleaders away from the cool clique of the ultra-popular stock investment club that follows the Motley Fool method of long-term buying-and-holding of sound, quality companies for a comfortable retirement... that's going to be the best one (and I know which group I'm in).

Cable networks are important to major media companies such as Fox, Disney (NYSE: DIS), and Time Warner (NYSE: TWX). They can produce nice returns if managed correctly. Viacom's (NYSE: VIA) MTV, for instance, produces a lot of cheap programming targeted toward valuable demos that bring in lucrative ad dollars; also, there is the income stream derived from carriage fees that cable and satellite systems pony up to place the property on its lineup. These fees can lead to cantankerous conflicts, as seen in a recent battle between Viacom and EchoStar Communications (Nasdaq: DISH).

News Corp. (NYSE: NWS) CEO Rupert Murdoch is a smart, tough competitor. He makes sure the people get what they want so he can get what he wants -- money. While I don't necessarily care whether there are reality channels or not on my cable dial, shareholders in News Corp. or Fox should champion an initiative like this since niche cablers such as these should do well from a financial perspective (and they add plum content for Murdoch's DirectTV asset). Then again, since I am a Disney shareholder, maybe I do care about reality channels. Note to Michael Eisner: Have the Mouse start up its own reality network, and start things off right -- do a show based on this gag from the April Fool's Day edition. It's gold, I'm telling you...

Fool contributor Steven Mallas owns shares of Disney and GE... and although he realizes that the reality-show idea based around traders was a Motley Fool put-on, he thinks Tom and Dave should pitch it anyway.