Chernin Said to Pitch TV Channel for Microsoft's Xbox Live Gaming Platform

Microsoft Corp. and former News Corp. President Peter Chernin have discussed creating a television channel for users of the Xbox video-game console, said two people with knowledge of the proposal.

The channel would be exclusive to subscribers of Microsoft’s Xbox Live video-game network, said the people, who sought anonymity because the talks are private. At an April 12 meeting in Redmond, Washington, Chernin suggested raising Xbox Live’s monthly fee by $1 or $2 to add programming aimed at the online service’s young, male target audience, one person said.

The channel would be owned jointly by Chernin and Microsoft, said one of the people, and would offer reruns and original shows. Chernin’s proposal underscores Hollywood’s efforts to find new ways to convince viewers to pay for films and TV shows delivered on the Web.

“Peter is talking to lots of people about lots of ideas in the digital space,” said Allan Mayer, his publicist. Mayer wouldn’t comment on talks with Microsoft. Wayne Hickey, a spokesman for Microsoft, declined to comment.

Microsoft, the world’s biggest software maker, hasn’t responded to the proposal, both people said. The Redmond-based company rose 32 cents to $31.36 yesterday on the Nasdaq Stock Market. The shares have gained 2.9 percent this year.

Chernin also broached the idea for the channel with Conan O’Brien’s representatives before the late-night comedian opted for a show with Time Warner Inc.’s TBS, one of the people said.

Netflix, PS3

Xbox, Sony Corp.’s PlayStation3 and Nintendo Co.’s Wii now provide access to programming including movie rentals from Los Gatos, California-based Netflix Inc. Microsoft charges $7.99 a month for multiplayer gaming on Xbox Live. A separate Netflix subscription with online access to movies costs $8.99 a month.

PlayStation3, which offers free access to online gaming, and Microsoft allow users to buy and rent TV shows and film releases that include “Sherlock Holmes,” from Warner Bros.

Chernin stepped down as New York-based News Corp.’s second- in-command on June 30, 2009, taking a film and television production deal at Fox. He agreed to give the company’s Twentieth Television and Twentieth Century Fox movie studio the first option to buy any projects, according to regulatory filings.

To contact the reporter on this story: Ronald Grover in Los Angeles at rgrover5@bloomberg.net; Andy Fixmer in Los Angeles at afixmer@bloomberg.net.

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