The company, operating under the working title Media Co., as expected hired Mr. Stringer to serve as chairman-CEO.
Though the new venture already had some heavyweight credentials, including consultant Michael Ovitz, head of powerful Hollywood talent agency Creative Artists Agency, it has been long on proclamations about a new interactive media network but short on details about either its content or technological means.
"It sounded like a lot of vaporware. Now they have something real, a CEO," said Gene DeWitt, president of DeWitt Media, New York.
And not just any CEO. Mr. Stringer joins the new telecommunications company venture from a 30-year stint at CBS, where he most recently was president of the CBS Broadcast Group, not to mention the network's spiritual leader.
Mr. Stringer said the timing of his departure is coincidental with CBS' recent ratings woes and an expectation that the company would soon be acquired or merged with another (see story on Page 25).
"The opportunity simply was too good to miss at this time," said Mr. Stringer. He said the timing of his departure followed extensive conversations with Mr. Ovitz, whom Mr. Stringer got to know during involved negotiations to woo CAA client David Letterman to CBS from NBC.
Mr. Stringer is not expected to recruit Mr. Letterman, who has a long-term contract with CBS, to the new media venture. He declined to discuss other stars he and consultant CAA have in mind.
But Pacific Telesis Chairman-CEO Phil Quigley said: "One of the first fruits of this relationship with Mike Ovitz is Howard Stringer. He's our star right now."
A non-compete clause in his CBS contract prevents Mr. Stringer from recruiting network colleagues to work for Media Co.
Mr. Quigley said Mr. Stringer will head a company that combines two simultaneous ventures the telephone companies joined together to form: One will develop programming, the other will develop new technologies for the new media.
Particular emphasis will be on interactive capabilities that will include video-on-demand, on-screen navigation systems, and new forms of participatory programming and advertising.
Mr. Stringer, who expects to name a chief operating officer for each of the two units, anticipates choosing a formal name for the new network and being ready to deploy its first products by late 1995.
Mr. Stringer said traditional advertising would probably play only a modest role initially, because the interactive nature of the digital service would mean viewers presumably would elect not to watch conventional commercials. But PacTel's Mr. Quigley said the service will also carry conventional analog TV programming channels now carried on cable TV.
Mr. Quigley said, pending regulatory approval of its video dial-tone service, the new network ultimately would reach about 30 million households, including heavy penetration in six of the top seven media markets: New York, Boston, Philadelphia, Washington, San Francisco and Los Angeles.
He said Federal Communications Commission approval is expected shortly for this application of video dial-tone service, and the network already is available to 3,000 homes in California.
As for Mr. Stringer's alma mater, the departure is expected to accelerate a merger or sale of CBS.
To succeed Mr. Stringer, CBS named Peter Lund president of the CBS Broadcast Group from president of the CBS Television Network and exec VP of the broadcast group.