Cablevision starts local media group

NEW YORK (Reuters) - Cablevision Systems Corp said on Wednesday it has started a local news media group it its home territory of New York's metropolitan area and appointed a former trade news company executive to run it.

The group will include Long Island's Newsday newspaper, which Cablevision bought from bankrupt newspaper publisher Tribune Co, and its News 12 cable news network.

The Long Island-based cable operator recruited Tad Smith, the former chief executive of Reed Business Information U.S. to oversee the group, which will organize its local media and programing properties under one unit.

Smith, who will report to Cablevision Chief Operating Officer Tom Rutledge, likely will be in charge of finding ways to get people to pay for its news online.

Rutledge told investors earlier this year that Cablevision plans to end the distribution of free Web content.

Cablevision bought Newsday last year in much criticized $650 million deal that it later wrote down by $420 million in February. Newspapers have been out of favor with Wall Street and investors for several years as paying consumers and classified advertising have moved to the Web.

Cablevision is working on plans to use local content and information as a differentiator in its competition to win and retain customers against rivals such as Verizon Communications and satellite TV companies.

For example, local news channel News 12 is not available on Verizon's rival FiOS TV service.

News 12 launched in 1986 as a "hyper-local" programing 24-hour news service made up of seven individual local news channels and five traffic and weather channels serving Long Island, New Jersey, southwestern Connecticut, Westchester County, the Hudson Valley, Brooklyn and the Bronx.

While at Reed Business, Smith's oversaw Hollywood industry bible Variety magazine and cable business title Multichannel News, and oversaw the group's digital media business.

News 12 chief Patrick Dolan and Newsday Media Group chief executive Timothy Knight will report to Smith.

Cablevision is preparing to spin off its Madison Square Garden unit which houses sports teams like the New York Knicks basketball team and New York Rangers hockey team, and entertainment venues like Radio City Music Hall and Beacon Theater.

Cablevision shares fell 14 cents, or 0.67 percent, to $20.91 on the New York Stock Exchange.

(Reporting by Yinka Adegoke. Editing by Robert MacMillan)