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Welcome to TVBR's Daily Epaper
Volume 24, Issue 206, Jim Carnegie, Editor & Publisher
Monday Morning October 22nd, 2007

TV News ®

WGA authorizes strike;
It means what to ya

The Writers Guild of America voted Friday in LA to authorize a strike against studios, networks and producers if the two sides can't agree on a new contract (the current one expires 10/31). More than 90% of members voted to authorize a walkout if WGA negotiators determine that a fair and reasonable contract cannot be negotiated with studios and networks. Members cast 5,507 votes, the highest turnout in Guild history, surpassing the previous Guild record of 4,128 votes cast in the 2001 MBA contract ratification. Talks are set to resume today.

TVBR observation: The real culprit of the potential strike is New Media, everyone wants a piece of the action, called Money. A Strike is not new news but what does it mean to the Fall season? Well not much yet even if the strike is a go as the programming influence would not hit until around December. But if there is a STRIKE look for - Scripted shows getting hit first and then the TV screen would get a heavy dose of unscripted programming with more reality and game shows for fill or like being saturated with tons of the American Idol. The networks would pull out the reruns of the scripted programming which could be good and give the viewer a chance to catch up on the endings they missed this year of top rated shows. TVBR checked with a few in the biz for their observations and if there is a strike most said it would be good for newbie programs that struggle every season just to stay on the air as the networks would be slower to pull anything off that has original content. The impact on the big screen would be next to nothing compared to TV as we all know it takes forever to even make a crappy film.

So let's see what today brings as the last strike by the WGA was in 1988 and it cost the industry around 500 million bucks. Now do the math today and see what that same 500 million will be as it is all about the money. Finally, nobody is stuck on stupid here so do not think for a second that producers, or networks and the studio's are not prepared as you can bet they all have contingency plans and are ready for the October 31 deadline.

The vote wasn't even close
A proposal to give current non-voting Class A shares the same voting rights as Class B shares at News Corporation found little support at Friday's annual shareholders meeting. The proposal, which was opposed by Rupert Murdoch and the company's board, was voted down 77% to 23%. There was quite a bit of talk about News Corporation's newest project, Fox Business News, during the session. Activist investor Evelyn Davis tried to pry some additional information from CEO Murdoch about just where he wants FBN to go with its programming, but he declined to offer specifics, calling it "a work in progress." Murdoch later said he expects News Corporation to spend up to 200 million on FBN over the next three to four years as it tries to topple CNBC from leadership in business TV, just as Fox News Channel did with CNN in all news TV. But while traditional media is still strong for News Corporation, new media is growing fast. Murdoch said he would not be surprised to see revenues for Fox Interactive Media top one billion bucks in the new fiscal year.

TVBR observation: Although Murdoch only holds about 30% of the voting shares at News Corporation, it is hardly surprising that most other Class B shareholders joined with him in refusing to eliminate the dual class share structure. There are slightly less than one billion Class B shares outstanding, but around 2.2 billion Class A. So, the Class B shareholders - who were the only ones who got to vote - were being asked to dilute their own voting power to less than a third of what they currently have.

Martin ownership plans
draw immediate fire

The watchdog community was ready, and the aiming seemed already to have been done, when FCC Chairman Kevin Martin announced his intention to try for a media ownership vote on 12/18/07. Most who commented were against any further deregulation. A coalition of watchdogs,, released a statement noting that it was "shocked by the FCC's secret timetable," and already has a click-and-send message ready for people to fire off to their representatives in Congress. It reads, "A report in the New York Times reveals that the FCC is moving forward with a secret timeline to vote on sweeping changes to media ownership rules. This is just the most recent in a long series of FCC moves to avoid public scrutiny. I strongly urge you to call for Congressional oversight hearings on media ownership. Media is a life-and-death issue for me and my community, and the FCC has not done enough to study the impact that more consolidation would have on diversity, localism, and competition. The FCC is poised to make the same mistake it made in 2003, when it ignored unprecedented public outcry, and had to be reined in by the courts. Help hold the FCC accountable. Please call immediately for oversight hearings on media ownership."

Although alarms are being sounded and barricades manned by watchdogs, many believe that Martin's deregulatory goals may be relatively modest, given the popular, judicial and legislative hurdles thrown before the 2003 ownership effort. He has frequently stated his support for ending or relaxing the restrictions on newspaper-broadcast cross-ownership. Both the National Association of Broadcasters and the Newspaper Association of America have asked for that relaxation. NAB has also pointed out that allowing small-market television stations some of the same duopoly benefits that are available in larger markets may be a necessity for their continued solvency, but has not recently called for much else in the way of further deregulation.

TVBR observation: It's interesting that a likely push for cross-ownership comes just as many multimedia companies are or are considering splitting their broadcast and print properties into separately-run entities. While watchdogs opposing any move of any kind are still on fire, business interests in favor of action, short of companies like Tribune, may be less so. Stay tuned.

Dow Jones settles lawsuits
Dow Jones & Company says in an SEC filing that it has come to terms with shareholders who had sued to block the company's sale to News Corporation for 5.6 billion bucks. The lawsuits had charged that no proper auction of Dow Jones was ever conducted because of the long-time resistance of the Bancroft family to sell the company, which they controlled through super-voting shares. Although the Bancrofts did open the door to competing offers, the lawsuits claimed that some terms of the deal with News Corporation restricted other companies from bidding. But that has now all been settled. Dow Jones will pay 895K of the plaintiffs' legal fees and has agreed to make public the internal financial forecasts which were provided to News Corporation. Those forecasts show Dow Jones management projecting that some 234.5 million in operating income this year would grow to 337.4 million in 2009.

TVBR observation: Why the plaintiffs persisted in their lawsuits after the Bancrofts reluctantly agreed to sell the company and open the bidding to all comers is beyond us. Several potential bidders looked at the company, but there was no indication that anyone was even contemplating a bid that would have come close to matching News Corporation. Dow Jones shareholders got top dollar for the company in a deteriorating market.

Letter auction raises over 2M
Did the folks in the Clear Channel mailroom in San Antonio realize they were handling merchandise worth over two million bucks when a letter to CEO Mark Mays came in from Capitol Hill? The charity auction on eBay of the letter from 41 Senate Democrats demanding that Mays denounce Rush Limbaugh (10/16/07 TVBR #202) concluded Friday with a winning bid of 2,100,000 from Maryland philanthropist Betty Casey. That was the record charity auction on eBay, topping the previous 1.5 million-plus paid for a Jay Leno motorcycle to benefit victims of Hurricane Katrina. Proceeds from the letter auction will go to a charity that provides scholarships for the children of US Marines and police officers killed in the line of duty. Despite his differences with Limbaugh, Senate Majority Leader Harry Reid (D-NV) took to the Senate floor Friday to praise the charity auction effort. Limbaugh has pledged to match the auction take, so The Marine Corps - Law Enforcement Foundation stand to get over four million bucks.

TVBR observation: The really funny part is that Reid said he'd talked with Mays about the letter auction and that they never thought it would raise much money. So, he was amazed to see the tally go over the two million mark. Somehow, we doubt that it was Sen. Reid's signature that drove the price up. Democratic presidential candidates Hillary Clinton and Barack Obama were among the senators who signed the letter. By the way, TVBR looked up the political contribution records of Betty Casey and found that she mostly gives money to GOP campaigns - but recently donated to the Obama campaign as well.

Smart Television Alliance kicks off
There's a new watchdog in town. The goal of Smart Television Alliance, according to STA co-chair and National PTA President Jan Harp Domene: "By uniting a diverse group of nationally recognized nonprofit organizations with a shared commitment to improving what kids watch on TV, we will help parents make informed choices about what television programming their families watch. We want to make screen time healthy and educational, gathering the best information from a variety of trusted sources, including children's media experts, educators and parents." The organization is spearheaded by National Education Association (NEA), National Parent Teacher Association (PTA), and the National Council of Women's Organizations (NCWO). Program recommendations will be coming from "Parent's Choice Foundation, Common Sense Media, Parent's Television Council, member organizations, as well as from parents and caregivers by means of an interactive Website and Smart News, STA's twice monthly free newsletter." TiVo is providing seed money for STA.

TVBR observation: TiVo. Hmmmmmmm (chin stroke chin stroke). TiVo has trying to offer itself as the ultimate tool for parental control of what children see on television. This is a prime example of a business model and philanthropy coinciding.

Ad Business Report TM

Study: auto ad mix
and must evolve

According to a new research study of new-car buyers conducted in cooperation with R.L. Polk & Co, new-car buyers find the Internet to be one of the most helpful media sources for information throughout the entire car-shopping process. And the Internet is second only to the dealer visit - where consumers interact with and test drive the car - as the overall most useful source of information throughout the entire car-shopping process. While, according to the study, 42% of new-car buyers said the Internet was the most helpful source of information during their car buying process, only 8% said television was the most helpful source of information, 2% said direct mail was the most helpful source and only 1% said radio or newspapers were the most helpful sources.

However, 2006 National Automobile Dealers Association data indicated 27.3% of dealer advertising dollars were spent on newspapers, 19.5% was spent on television and 18.1% was spent on radio, while only 11.5% of dealer advertising dollars were spent on Internet. Direct mail accounted for 10.2% of dealers' advertising spend and 13.4% was attributed to "other" sources. In 2005, according to NADA data, 9.9% of dealer advertising dollars were spent on Internet advertising. When searching the Internet for new cars, 27% of new car buyers said dealer inventory was the most important piece of information they wanted. In searching the Internet, 36% of new-car buyers said the original manufacturers sites were the most useful of the Internet sites they searched. 20% said third-party car sites were the most useful sites and 18% said individual dealer sites were the most useful sites.

TVBR observation: Figure it is time to really learn what your stations website can do or do you want newspapers to keep taking your cash.

Media Business Report TM
Talkers double down on 2008
According to the Project for Excellence in Journalism, the 2008 presidential campaign dominated the newshole for the week of 10/7-12/07 with 15% of the coverage -- stories tied at #2 only got 6%. Talkers were even more focused on the campaign, handing it 33% of their available time and space. Immigration was one of the #2 news stories, as it was with talkers who slightly elevated it to 8%. From there the order of focus diverged. Talkers made domestic terrorism #3/7%, compared to #7/3% over in the news room. Back on the campaign trail for a moment, two media figures figured prominently in the discussions, both pro and con. One was actor Fred Thompson, who has moved back into the political arena and participated in his first debate; the other was TV/cable talker Chris Matthews, who moderated it.

Media Markets & Money TM
Tyler TV headed for London
KYTX-TV, serving CBS fare to the Tyler-Longview DMA from its perch in Nacogdoches TX, is changing hands. The Channel 19 station is going form Max Media to London Broadcasting Company for 25M. Terry E. London is the London behind the buyer's company name. "I have been looking for quite some time for a television station to acquire to start London Broadcasting," he told the local News-Journal. He said he was particularly interested in ownership in a smaller community. Station President/GM Phil Hurley is staying on through the ownership change along with the entire staff.

Washington Business Report TM
Communications sector
betting on Democrats

The communications/electronics industry is ranked 7th out of 13 business sectors in terms of donating cash into the 2008 political races. It's responsible for over 28M in donations, 68% of which has gone to Democratic candidates, according to a study from The Center for Responsive Politics. In all, nine of the 13 sectors (one of them is the standard grab bag "other" and another is the only slightly more descriptive "miscellaneous business") gave a plurality to the Democrats. The two strongest categories for Democrats are labor and lawyers/lobbyists. Republicans enjoy their greatest support from construction and energy/natural resource interests.
| See the full chart |

How moot can you get?
Is mooter a word? If not, can we coin it, as in it doesn't get much mooter than this? Anyway, the parade of out-to-lunch license renewal challenges continues. Michael Erickson, Gerald John Mehrab and Ralph Amitrano Jr. fired off identical petitions to deny a license renewal to Multicultural Radio Broadcasting's WNYG-AM Babylon NY. Their beef? They were concerned that the station was going to pull up stakes and move to Elizabeth NJ. There was only one problem with that contention: Multicultural's application to make that major move was denied. The FCC noted that the objections were therefore moot, but took advantage of the situation to go on the record with a simple fact: The time to object to a city of license change is when the city of license change is applied for. Applying for such a move is perfectly within Multicultural's rights and in no way impugns its fitness as a licensee, so the petitions to deny the renewal would have gone nowhere regardless of which way the thumbs were pointing on the Babylon-to-Elizabeth matter.

Entertainment Business Report TM
CBS picks up two for season
The Eye net has given a full season order to one of its newbies, the comedy "The Big Bang Theory." Also getting an order for a full season of shows is the drama, "The Unit," which is in its 3rd season. CBS notes that The Big Bang Theory, a newcomer to CBS's Monday comedy block, is averaging 8.97 million viewers, 4.3/10 in adults 25-54 and 3.6/09 in adults 18-49 in its 8:30-9:00 pm ET/PT time period. It is the first new comedy to get a network pickup this fall. The series stars Johnny Galecki, Jim Parsons, Kaley Cuoco, Simon Helberg and Kunal Nayyar. Chuck Lorre and Bill Prady are executive producers for Warner Bros. Television. The Unit is averaging 11.44 million viewers, 3.1/08 in adults 18-49 and 4.2/09 in adults 25-54. It stars Dennis Haysbert, Scott Foley, Robert Patrick, Regina Taylor, Max Martini, Michael Irby, Demore Barnes, Abby Brummell and Audrey Marie Anderson. David Mamet, Shawn Ryan and Vahan Moosekian are executive producers for Twentieth Century Fox Television.

TVBR note: Now if a WGA strike hits, see TV News, this newbie gets little more air time.

Internet Business Report TM
Media, internet coalition
sets copyright rules

A coalition of major media and web companies issued a set of guidelines for handling copyright-protected videos on user-generated sites. However, YouTube was not part of the pact, as it just rolled out its own technology to filter copyrighted videos once they've been posted. Companies that did join on include Disney, Viacom, CBS Corp., NBCU, News Corp., Microsoft, MySpace, Veoh Networks and Dailymotion. The guidelines require sites to use filtering software that blocks all content media companies flag as being unauthorized from being posted without permission before they're posted, not after. They also require websites to identify other sites that repeatedly try to upload unauthorized content and either block those sites or remove links to them. Internet companies will be required to have the technology in place by the end of the year.

Monday Morning Makers & Shakers

Transactions: 9/3/07-9/7/07
Radio trading made somewhat of a comeback in the first week of September. It wasn't all that amazing or anything, but when you consider four weeks of August yielded only 33.09M worth of value, this week's 32.364M looks pretty good. Also encouraging was that six separate transactions managed to clear the 1M hurdle, so it wasn't a case of one agreement providing virtually all of the cash changing hands. Clear Channel was a shadow on the TV side, as a pair of stations it sold were resold.



Total Deals







| Complete Charts |
Radio Transactions of the Week
NRG expands into Lincoln
| More...
TV Transactions of the Week
TV group expands with CCU pass-alongs
| More...

Stock Talk
Déjà vu on Wall Street?
Stocks took a tumble Friday, the 20th anniversary of the "Black Monday" crash. This time it was rising oil prices and continued problems in the credit markets that sparked the sell-off. The Dow Industrials dropped 367 points, or 2.6%, to close at 13,522.

Almost all TV stocks were lower. Gray Television (common) plunged 8.8% and its Class A 6.2%. Journal Communications was down 6.9%, LIN and Sinclair each 5.4% and Tribune 5.1%.


Here's how stocks fared on Friday

Company Symbol Close Change Company Symbol Close Change





Lincoln Natl.






















Media General




Clear Channel












News Corp.
















Ion Media




Equity Media EMDA 2.90 +0.05

Saga Commun.




















Gen. Electric








Google GOOG











Time Warner




Gray, C1. A












Wash. Post




Journal Comm.









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Below the Fold

Ad Business Report
Auto ad mix and must evolve
New-car buyers find the Internet to be one of the most helpful media sources...

Media, Markets & Money
Tyler TV headed for London
KYTX-TV, serving CBS fare to the Tyler-Longview DMA

Washington Business Report
How moot can you get?
Is mooter a word? If not, can we coin it, it doesn't get much mooter than this...

Monday Shakers & Makers
Television, Group expands
w/CCU pass-alongs Radio, NRG expands into Lincoln...

Stations for Sale

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More News Headlines

Decherd's wife injured
Belo Corporation issued a statement Friday on the condition of Maureen Decherd, wife of CEO Robert Decherd. She was reported to be in critical but stable condition in the intensive care unit of Parkland Hospital in Dallas. Mrs. Decherd had undergone emergency surgery after being struck by a car while she was in a crosswalk. She was thrown 20-30 feet and hit her head on a curb.

Scripps grant to UT
A half million bucks grant from the Scripps Howard Foundation will fund construction of a new media laboratory for the University of Tennessee's College of Communication and Information in Knoxville. The facility, which will be called the Scripps Convergence Communication and Information Laboratory, will be designed to help UT students prepare to work in a media industry that is becoming increasingly more digital and interactive. The Scripps Howard Foundation is the philanthropic arm of The E.W. Scripps Company, whose holdings include Knoxville-based Scripps Networks and the Knoxville News Sentinel newspaper.

Subaru selects Carmichael Lynch for creative, media
Interpublic announced that its Carmichael Lynch unit has been selected by Subaru of Subaru selects Carmichael Lynch for creative, media Interpublic announced today that its Carmichael Lynch unit has been selected by Subaru of America as lead agency for the client's creative and media assignments. Carmichael Lynch won the account without a review. Carmichael Lynch will be tasked with advancing the current Subaru marketing efforts, further strengthening the Subaru brand and increasing the effectiveness of Subaru's regional marketing operations.

Ruby Anik Director of Brand Marketing
J. C. Penney announced that Ruby Anik will join the Company as senior vice president and director of brand marketing, effective 11/26. Anik will oversee the development and execution of the Company's brand marketing strategy, clearly articulating the retailer's offering of style, quality at smart prices, and ensure the consistent execution of the JCPenney brand in all messaging. She comes to JCPenney from Best Buy, where she served most recently as senior vice president, marketing communications and business operations.

RBR - Radio News

Miami station
deal a win-win

That's the way Bear Stearns analyst Victor Miller sees the 12.25 million sale of WTPS-AM Miami (10/19/07 RBR #205). In his view, Radio One dumped a format that was losing money and Salem got a better signal for a format that is making money. Miller estimates that WTPS, with an African American Talk format, was bringing in about a million bucks in annual ad revenues for Radio One, but costing twice that to operate. But Salem was earning 400-500K in EBITDA from WKAT-AM, whose Religious teaching programs now move to the much stronger signal, which will adopt the Miami heritage calls WMCU, recently given up as a Miami non-commercial Religious station was sold to a public radio entity. Not only should Salem get higher profits from the 50kw signal, but it can now try something else on the 5kw signal. What's next? "Salem could ultimately launch a Spanish-language teach/talk station with WKAT or sell the asset," suggests Miller.

RBR observation: Let's put it out there, the format was not the area of specialty of Radio One. 2008 is the beginning of a new two year business cycle and any business operator that is stretched beyond their level of expertise will see their rubber band snap. To bring shareholder value and or profit to any business in our media world today get focused on your strengths and improve on you weaknesses. Miller is correct - Radio One dumped a format that was losing money and Salem got a better signal for a format that is making money. Learn from this.

TVBR Radar 2007
Television News you won't read any where else. TVBR--First, Accurate, and Independently Owned.

Media General rules out split
Don't look for Media General to split its newspapers and TV operations into separate companies. The company declared that it still sees benefits from having both broadcast and print operations and is hoping the FCC will dump the crossownership rule and let it own more local newspaper-TV combinations. Noting the company's nearly 160 years of successfully operating local media businesses, CEO Marshall Morton made it clear to analysts that he doesn't intend to have the company broken apart on his watch.

TVBR observation: Throughout the Media General conference call, we repeatedly heard Tampa mentioned. When real estate was booming, Media General raked in the bucks from its grandfathered newspaper-TV combination in the market. That operation has been held up repeatedly as an example of the advantages of crossownership to enhance local news coverage. But a single company can't buck an overriding economic trend. The Tampa market is hard hit by the housing downturn, so Media General has had to cut staff, particularly at the Tampa Tribune. Perhaps the cuts would have been even deeper if it weren't for the benefits of crossownership. Now, though, the company just has to hold on and operate WFLA-TV/Tampa Tribune as efficiently as it can until the local market recovers.
10/19/07 TVBR #205

Who bid for Lincoln
Financial Media?
Bids were due this week for the potential sale of the Lincoln Financial Media stations. There was, indeed, lots of interest in the portfolio of primo properties, both radio and television - the former Jefferson-Pilot Communications. The real question, though, given the current credit market, is whether the bidding will be strong enough for Lincoln Financial Group, primarily an insurance company, to exit broadcasting.

TVBR observation: As we expected, Raycom apparently bid for the Southeast-focused TV group and Randy Michaels' Local TV LLC (and twin-to-be Local Radio) bid for the whole kit-and-kaboodle. We hear that Entercom and Greater Media bid on the radio package, as did former CBS Radio CEO Joel Hollander with his new private equity backers. There were other bidders as well, we understand. Despite all of the rumors about Cox Radio coveting the radio properties and being the best fit, it is not clear whether the company made a bid. Will there be a winner? With a very low tax basis, Lincoln faces a big tax bite and may pass if the after-tax take doesn't do much for its balance sheet.
10/19/07 TVBR #205

No split interest at Gannett
CEO Craig Dubow made it clear in his quarterly conference call that Gannett has looked at various options, such as splitting off the company's TV operations, but that any such move has been rejected. Comparing Gannett's situation to Belo, Dubow noted that Belo's TV operations generate two-thirds of its cash flow, so it makes sense to separate the TV group from the newspaper business.

TVBR observation: Gannett's broadcasting operations would be a fairly substantial company on their own, at least by TV sector standards, but broadcasting is only about a tenth of Gannett's total revenues. So, splitting off the TV group would still leave the much larger company weighed down by the valuations that investors ascribe to the struggling newspaper business. We note that Craig Dubow came from the TV side, so he understands the role that video is playing for newspapers in the growing broadband world online and the in-house expertise of 23 television stations is a valuable resource for the 85 daily newspapers to tap into.
10/18/07 TVBR #204

Martin comes out strong
for multicast must-carry
At the latest House hearing on the DTV Transition, Kevin Martin said that broadcast multicasting was an excellent way to make consumer acquisition of digital equipment a positive rather than a negative sell, and that it should be emphasized as we move toward the DTV deadline. He advocated a multicast must carry requirements for cable operators.

TVBR observation: If you look at broadcast must-carry as a station's right to occupy a given slice of bandwidth, then it should not matter to the cable operator how the station uses its slice. If it's broadcasting in high-definition, it might use all of it for one stream. If it isn't in high-def, it can fit more stations into the same slice. It is a settled matter that broadcasters have a right to their slice of a cable system, and it follows that a cable operator must simply pass along what the broadcaster is putting out. Period.
10/18/07 TVBR #204

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