Karmazin/Goodmon do the network/affiliate joust

At the Senate Committee for Commerce, Science and Transportation meeting Tuesday (5/14 TVBR Daily Epaper #94), witnesses Mel Karmazin of Viacom (N:VIA) and Jim Goodmon of Capitol Broadcasting Company Inc. found themselves facing off.

One of the things which made the encounter interesting is the fact that the pair have an important business relationship: One of Goodmon's two Raleigh-Durham television stations - - WRAL-TV - - is an affiliate of Karmazin's CBS Television Network.

Goodmon was generally against consolidation. He felt that it endangers local programming in a number of ways. One example he gave actually involved his other station, WRAZ-TV, a Fox affiliate. He decided to preempt on of the Fox reality marriage shows, and had all kinds of trouble with the network after that. He noted that Fox had a three-strikes policy. Three unapproved preemptions of network offerings and your affiliation days are over.

The marriage show preemption was eventually excused under the community standards clause of the contract, but Goodmon said it took a lot of work to make that happen.

More than that, though, he noted that if WRAZ was an O&O rather than a locally-owned affiliate, it would have carried the program regardless of local sensibilities.

When quizzed on his view of television duopolies, given the fact that he owned one, he said he was generally against them too. He said he was forced to buy a second station not because he wanted one, but rather to keep it out of the hands of his many competitors in the market.

When quizzed further, was his ownership of both stations hurting the viewers in Raleigh, he laughed, and said that in his case, under his excellent leadership, no it wasn't.

Karmazin represented the network point of view. His first point was that the network business was OK, and the television business it great. He said it was no accident that all of the networks were big into O&Os - - that is where they really make their money. "When I die and come back, I'm coming back as an affiliate," he cracked at one point.

As for preemptions, he said it is acknowledged by all nets that it is the right of all affiliates to preempt a certain amount of network programming, and that the amount is negotiated and is a matter of contract.

Senator Ron Wyden (D-OR) attacked preemption from another angle. He spoke of a station in Eugene which wanted to sign off its network to run a 10PM newscast, but was not allowed to.

In answer, Karmazin explained what a network was and how it worked. The network is premised on its ability to bring viewers from every market. It needs the viewers in Raleigh and the ones in Eugene, and everywhere else, in order to fulfill its obligations to its clients.

The owner of a station doesn't have to become an affiliate. However, if he signs an affiliation agreement, he is expected - - obligated - - to run the programming offered. Again, it's a matter of contract, just as the station's preemption rights are.

If the owner does not like the programming being offered, he is under no obligation to re-up at contract renewal time. Conversely, if the station is not running the network's offerings, the network has no option other than finding a local owner who will.

Karmazin noted that he runs a business, and he has to make choices about how he spends his company's money. He's spending a great deal for football rights, programming that benefits all of his affiliates and is provided free to the public (which just has to put up with watching CBS's commercials). He said that if this business model gets to be no longer workable, the football games could be moved over to cable with a consumer pricetag attached.

He didn't think the public or the affiliates would be too happy with that development.

On the topic of localism, Karmazin argued that Viacom does run local television operations. Like Clear Channel's Lowry Mays said in the same room a few months earlier, broadcasting is a local medium - - there is no other effective way to operate if you want to maximize the performance of your media properties.