Asked about prospects for reversing the slump in national advertising for TV, Gray Television President Bob Prather replied, "I’m not sure it can be fixed." His company is focused on growing local, which is already 73% of Gray’s revenue mix, and he’d like to see that grown to 80%
Prather said many advertisers at the national level are experimenting with new media approaches, diverting spending from traditional media, such as television, to try various online and mobile approaches to consumers. "A lot of that stuff is not gonna work," Prather said, so he has hopes that HD will bring viewers and advertisers back to TV. "Once people start seeing HD commercials I think advertisers are going to realize that if they’ve all of a sudden got a new product out there this is a lot more dramatic presentation of their product, so I’m hopeful that’s going to regenerate some interest in national," Prather said. For the short run, though, he’s budgeting for national to have no growth or decline over the next few years.
But with local picking up the slack, Gray is projecting that Q1 revenues will be flat to up 1%. Of course, Prather is expecting stronger growth later in the year as political kicks in. He’d also like to see Democratic primary do-overs in Florida and Michigan, both states where Gray has significant stations, so he suggested that listeners on his quarterly conference call send in their cards and letters supporting that idea. For all of 2008, Prather is expecting political revenues of 60 million at Gray – and he’s hoping that proves to be a low estimate. The company booked 53 million in the last presidential election year, 2004.
RBR/TVBR observation: Local, local, local. Bob Prather gets it. Control your own destiny and make money. Put feet on the street and bring in business. Gray just can’t get enough of local content to sell. Prather says the company will increasingly use its digital multicast channels to put local high school and college sports on the air.