NBC and Hearst-Argyle TV will combine their production and distribution units under new agreement, terms not disclosed. New venture, to be headed by Ed Wilson, pres. of NBC Enterprise, will allow partners to focus on producing original programming for cable and weekend syndication market, Wilson said.

Harris Corp. broadcast sales grew 21% in 2nd quarter ended Dec. 29, mainly because of sales of DTV transmitters, company said, and orders were at record level. RF Communications Div. sales also set record. Overall revenue jumped to $450.3 million from $389.3 million, operating profit to $36.6 million from $28.1 million and net profit to $19.7 million from $19.5 million.

Provision of entertainment is merely incidental to cable operator’s demonstrated function of transmitting clear, viewable signal, N.Y. State Supreme Court Appellate Div. ruled in overturning state Tax Appeals Tribunal’s finding that 2 state cable operators were taxed properly as general business as opposed to transmission corporations. Acting on petition challenging tribunal’s finding by NewChannels and Upstate Community Antenna, court in 5-0 decision termed as “entirely irrational” tribunal’s conclusion that transmission was merely means by which cable operators conveyed their products to subscribers and therefore was incidental to their actual business of providing entertainment. Primary basis for tribunal’s conclusion that petitioner’s weren’t engaged in transmission business, court said, stemmed from its belief that focus of cable service wasn’t transmission of various signals but provision of entertainment. Court said record made plain that cable operators: (1) Have limited capacity to manipulate signals they capture from cable programmers and transmit to subscribers. (2) Have no control over content of signal received aside from getting “rid of ghosts,” clarify signal or amplify it. (3) Can’t dictate when or how many times particular program will be broadcast. (4) Can’t sell ads on local or premium channels they offer. With exception of local origination programming they are required to carry, petitioners offered no original programming, court said. NewChannels and Upstate Community Antenna filed suit after tribunal upheld state Dept. of Taxation & Finance decision to assess deficiencies against 2 companies on ground that they should have filed tax returns as general business corporation rather than transmission corporation.

Excite@Home said it would drop 250 employees, 8% of its total work force, to slash costs and reach profitability sooner as online ad market suffers. Excite@Home, which posted $668.7 million loss on $169.9 million in sales in 3rd quarter ended Sept. 30, said most of cuts would be in company’s online content areas. It said it also would trim staffing in such corporate and administrative areas as finance, human resources, marketing. But company, which closed 2000 with nearly 3 million high-speed data subscribers, said it wouldn’t eliminate jobs in its broadband access businesses and broadband network operations. Excite@Home said it would take $8 million charge for layoffs in first quarter.

LAS VEGAS -- It’s “increasingly likely” that NAACP will start boycott soon against one of Big 4 TV networks (unnamed) and its advertisers because of what Assn. Pres. Kweisi Mfume called networks’ “snail’s pace” in their diversity efforts after they all signed agreements last year to increase those efforts (CD Jan 10/00 p1). At appearance before NATPE convention here Mon. afternoon, he also called for return of financial syndication (finsyn) rule that prohibited networks from having financial interests in syndicating programming, and for legislation requiring networks to air 3 hours weekly of programs written, starring and produced by minorities. As justification for latter, he cited FCC’s 3-hour kid TV rule.

Cidera quietly became latest satellite company to admit plans of big profits in Internet business were being tempered with “coolness” of capital markets and need to grow at slower pace. Those factors coupled with rapid development of fiber networks expanding into remote areas and lagging demand for satellite Internet services have hurt company, industry sources said. Seeking to streamline operations and get clear focus on future, Cidera rewrote business plan despite raising $75 million from private investors last month and brought back former CEO Douglas Humphrey to replace Richard Hanna, who became “victim of the dot- com plague,” a source said. Cidera cut staff 1/3 with layoff of 100 workers, including 5 members of senior management. While company has been close-mouthed about plans, it has indicated it will use its satellite network to concentrate more on niche business customers rather than broader Internet.

To date, Starband hasn’t issued official comment on letter to subscribers posted on Web site Tues. apologizing for problems of sluggish download and upload speeds of 2-way satellite Internet service. Letter was posted following “numerous complaints,” customer service representative told us. Letter said: “We hear you and we want to apologize for any inconveniences this may have caused.” Starband promised to perform network maintenance and upgrade areas of its network in next several weeks, with result that users should see “gradual improvements” in service. Starband also extended 30-day return policy through Feb. 28 and said customers who purchased receivers directly from company would receive $50 credit. DISH customers will be mailed 50 DISH dollars that can be used on next payment statement. Spokeswoman wasn’t available for comment.

Qwest Communications reported strong results Wed. including 10% rise in revenue to $5 billion for 4th quarter that ended Dec. 31, with Internet and data services revenue growing almost 40%. Net income excluding one-time charges increased 44% to $270 million (16 cents per share), 2 cents higher than Wall St. expected. Qwest CEO Joseph Nacchio said he also was happy with “trend lines” that indicated company would meet future goals. “We spent capital in the right places” such as improved local exchange phone service in old U S West territory, he said. U S West is “no longer the worst operating telephone company in the country,” Nacchio said. “We put improved customer service on top of our priorities, we put capital there and we're seeing results.” Qwest’s results reflected some savings through synergies from merger with U S West but “most synergies will be ahead” in 2001, he said. In earnings conference call, Nacchio touched on company’s Sec. 271 strategy. He said he was heartened by FCC’s recent approval of SBC’s “multiple-state” application for Sec. 271 authority in Okla. and Kan. because Qwest also plans to file multiple applications once it gets started. With joint testing under way in 13 of its 14 states “you can expect multiple applications.” Nacchio said Qwest “probably will be the last to get the first state but the first to get the last state” approved by FCC. He said his first state probably would be Colo.

Faced with loss of $1.02 billion in first fiscal quarter ending Dec. 31, Lucent Technologies announced restructuring plan Wed. that called for reducing its cost structure by more than $2 billion, taking up to $1.6 billion in restructuring charges, cutting 10,000 employees through layoffs and attrition. “Our problems are fixable,” Lucent CEO Henry Schacht said. He called fiscal 2001 “a transition year, when we are rebuilding for the future.” Company also plans to eliminate some product lines and outsource more work to contract manufacturers. Lucent had profit of $1.08 billion in same quarter year ago.

PBS Pres. Pat Mitchell received $315,000 salary, excluding bonuses or other incentives, in fiscal year ending June 30, 2000. Salary is twice as much as $151,658 her predecessor, Pres. Ervin Duggan, received in FY 1999, when salary cap was in place.