Welcome to TVBR's Daily Epaper
Volume 24, Issue 234, Jim Carnegie, Editor & Publisher
Monday Morning December 3rd, 2007
WGA Strike Central: Day 29
WGA to mull AMPTP offer;
not optimistic

Both sides have agreed to get back to negotiations tomorrow, after WGA has a few days to consider the offer made Thursday by the Alliance of Motion Picture & Television Producers. The proposal would deliver more than 130 million in additional compensation to writers over three years. The WGA issued joint statement from WGA West president Patric Verrone and WGA East president Michael Winship calling the proposal as "a massive rollback." WGA released some of the proposal's details, mentioning their news blackout during negotiations has been lifted. Excerpts: "...for the first three days of this week, the companies presented in essence their 11/4 package with not an iota of movement on any of the issues that matter to writers. For streaming television episodes, the companies proposed a residual structure of a single fixed payment of less than 250 for a year's reuse of an hour-long program (compared to over 20,000 payable for a network rerun). For theatrical product they are offering no residuals whatsoever for streaming. For made-for-Internet material, they offered minimums that would allow a studio to produce up to a 15 minute episode of network-derived web content for a script fee of 1,300 dollars. They continued to refuse to grant jurisdiction over original content for the Internet.

In their new proposal
They made absolutely no move on the download formula (which they propose to pay at the DVD rate), and continue to assert that they can deem any reuse "promotional," and pay no residual (even if they replay the entire film or TV episode and even if they make money). On Wednesday we presented a comprehensive economic justification for our proposals. Our entire package would cost this industry 151 million over three years. That's a little over a 3% increase in writer earnings each year, while company revenues are projected to grow at a rate of 10%. We are falling behind.

Cost Factor
For Sony, this entire deal would cost 1.68 million per year. For Disney 6.25 million. Paramount and CBS would each pay about 4.66 million, Warner about 11.2 million, Fox 6.04 million, and NBC/Universal 7.44 million. MGM would pay 320,000 and the entire universe of remaining companies would assume the remainder of about 8.3 million per year. As we've stated repeatedly, our proposals are more than reasonable and the companies have no excuse for denying it. The AMPTP's intractability is dispiriting news but it must also be motivating. Any movement on the part of these multinational conglomerates has been the result of the collective action of our membership, with the support of SAG, other unions, supportive politicians, and the general public. We must fight on, returning to the lines on Monday in force to make it clear that we will not back down, that we will not accept a bad deal, and that we are all in this together." If the sides don't make serious progress this week, reportedly AMPTP may put it all on hold and start negotiations with the Directors Guild of America, whose contract expires 6/30.

Conan to pay employees, too; Leno staffers laid off
Add Conan O'Brien to the list that includes Letterman in paying their non-writing staffers out of their own pockets/production companies while the WGA strike rages on. Meanwhile, The Tonight Show with Jay Leno staggers were laid off on Friday, as expected. Conan O'Brien will pay the salaries of nearly 80 employees until further notice. Letterman's Worldwide Pants is also paying staffers at The Late Late Show with Craig Ferguson.


TV News ®

Tribune gets thumbs up from FCC
Tribune announced the FCC has approved the transfer of its broadcasting licenses and the extension of its cross-ownership waivers for two years or up to six months in markets where it owns both a TV station and a newspaper. The approval gives Tribune the thumbs up for a sale to a Zell-led Employee Stock Ownership/Option Plan. Tribune's going-private transaction is expected to close by year. When the transaction closes, Zell's investment in the company will increase to 315 million and he will become chairman of the board. Tribune also asked for an extension of existing waivers of the FCC's cross-ownership rule in New York, LA, Hartford and South Florida-markets where it operates both a newspaper and TV station. The waivers are temporary, pending the outcome of the FCC's ongoing review of media ownership rules. In Chicago, the company will be exempt from cross-ownership restrictions through a permanent waiver provision.

Less growth, more red ink going forward?
BMO Capital Markets analyst Leland Westerfield has knocked the overall ad spending projection for 2007 from growth of 3.4% to 2.6%, and he's taking 2008 growth down from 4.3% to 3.6%. The outlook for 2009 is even worse, at 2.7%. He says there are eerie similarities to the dot.com bust of 2000-2001. Westerfield says the culprit in 2008 may well be "the unwinding of 'overinvestment' among many financial service advertisers in recent years, what amounts to a correction of an advertising demand-imbalance. That theme rings eerily familiar to the 2000/2001 period, when the unwinding of dot.com and telecom categories of advertising led to the advertising recession."

Spot TV: Is expected to continue its election year pendulum swings while veering downward, finishing 2007 at -2.7%, riding the major national elections to a +9.2% gain in 2008, then giving much of that back in 2009 with a -6.3% drop. Broadcast networks are expected to follow a muted version of that same pattern, with a scant +0.1% gain in 2007, a +6.2% gain in 2008 and a -1.4% loss in 2009.

Radio: BMO sees not so much a downward spiral as a downward angled plane, with a -1.8% loss this year, another -1.8% loss next year and a -1.7% loss in 2009.

Cable and outdoor: Will fare better if BMO is correct. Cable will stay in the black with gains of +3.3% this year followed by +3.6% and +4.2%. Outdoor's numbers are even better, at +7%, +4.7% and +7%.

The big gainer? If you said Internet, Don Rickles might award you a cookie. Its numbers are predicted at +24.2%, +19.6% and +30%.

The big loser? If you said newspaper, help yourself to another cookie. It's red record is set at -5.3%, -4.5% and -6.2%.+

TVBR observation: If this was a Dickens novel we might have some recourse from these ominous forebodings from the Ghost of Things Yet to Come by repairing our wicked ways. The problem is there seems to be an entire platoon of these ghosts running around, intoning pretty much the same thing. All we can say is make sure you're tight with your local community, be kind to your local politicians, and try to get your fork into that burgeoning slice of pie on the Internet plate.

Publisher note: The TVBR/RBR website entry into the global internet world will appear in Jan. 2008 as all know by now TVBR/RBR has gone completely electronic, but if you missed it see 10/29/07 TVBR #211


Washington week in review
We're you stranded on a tropical island last week? Lucky dog -- we should be so lucky. But no, we were here staying on top of broadcast-related developments in Washington. Here's a thumbnail sketch of what you missed.

* FCC Chairman Kevin Martin got his vote on Friday (see above story) granting Tribune cross-ownership waivers for two years or up to six months after all cross-ownership proceedings are concluded, at least in its top 20 markets (which may or may not mean excluding Hartford).

* The FCC backed off plans to address the many issues pertaining to the Third Circuit remand of media ownership rules, particularly in regard to increasing ownership among socially disadvantaged businesses; and also backed off new regulation for cable companies pending further study.

* It did take steps to promote LPFM and is studying the adoption of even more steps, and it set new public interest/localism reporting requirements for television stations.

* Both Congressional Commerce Committees set up oversight hearings, with the House pegged for 12/5/07 and the Senate on 12/13/07.

* The Commission's open meeting on 12/18/07 is expected to feature a vote on Martin's plan to end print/broadcast cross-ownership restrictions in the top 20 markets, an event Sen. Byron Dorgan (D-ND) will try to head of at the pass with a bill being mark-up up in committee tomorrow, 12/4/07, which would delay the event until at least next May.

Sillerman has his ducks in a row
Credit crunch or no credit crunch, Robert F.X. Sillerman has lined up the financing so he and Simon Fuller can buy out the public shareholders of CKX Inc. and build up its entertainment and licensing businesses under the name 19X (19 Entertainment was Fuller's company that merged with CKX). The deal announced in May (6/1/07 TVBR #107) would pay shareholders 13.75 per share, or a total of 1.3 billion. CKX shareholders will also get shares in another Sillerman-related company which is planning a casino/hotel/commercial/residential real estate development in Las Vegas.

Bear Stearns analyst Christopher Ensley notes that the details of the financing plans have now been filed with the SEC. "CKX disclosed financing commitments that consist of: 1) 450M in 1st lien loans; 2) 200M in 2nd lien loans; 3) 200M in unsecured notes or Sr. pref. stock offered issued by 19X; and 4) 750M in equity financing (200M in equity from CKX management and 550M of preferred stock from 3rd parties). Credit Suisse and Deutsche Bank will provide the loans, while Merrill Lynch will arrange and distribute most (350M) of the preferred stock," Ensley said in a note. The analyst had expected a late Q1 2008 closing, but notes that the financing commitments allow for a potential Q2 closing. CKX owns the rights to "American Idol" and the name, likeness and image of Elvis Presley and Muhammad Ali.


Ad Business Report TM

"Mas Vale Tarde" launches with
Coors, GM, T-Mobile, Target

Alex Cambert launched an hour-long Thursday night weekly show 11/29 on NBCU's Telemundo, "Mas Vale Tarde" (Better late than never). The show is supplemented by daily web content. Cambert's show is decidedly bilingual, targeting the fastest-growing Hispanic demo: young bilingual, bicultural consumers. Coors Light has already signed up for a full year as a presenting sponsor, according to AdAge, which includes an onstage Coors bar on some shows, where guests will be interviewed, and sponsorship of man-on-the-street interviews. Other marketers involved include GM, which will sponsor a special stage called the Pontiac Garage for the show's musical acts, and T-Mobile and Target.


Media Markets & Money TM
Entravision looks to cross-own in Orlando
Hispanic broadcaster Entravision has an agreement in place to acquire WNUE-FM in the Orlando FL market. The Mega Communications station will join a Univision station Entravision owns in the market, and a Telefutura station it operates. The price for the station, which Mega already has in a Spanish language format, is 24M. The O&O television station WVEN-TV 26; WOTF-TV 43 is actually owned by Univision. Entravision says this will be the 11th market in which they combine radio and television properties.


Washington Business Report TM
Will FCC put placement in its place?
Advertisers are increasingly trying to weave their products into the sets and storylines of broadcast entertainment, to combat ad skipping via channel surfing and DVR-enabled ad skipping. The increased use of the technique is leading to an FCC inquiry, with a possible kick-off at the 12/18/07 Open Meeting. Several stealth advertising techniques, also including the use of critics/experts to demonstrate and/or tout products by arrangement and for compensation; video or audio news releases promoting a product or viewpoint without disclosure, or pay-for-say arrangements with broadcast hosts, have all come under fire in recent years, and the topic has become a pet issue for Commissioner Jonathan Adelstein (D). According to reports, Chairman Kevin Martin (R) will use the next open meeting to kick off a study on updating disclosure requirements.


Ratings & Research
CNN-YouTube GOP Debate
scores record 4.49 million viewers

CNN's YouTube Republican debate Wed. night a record 4.49 million viewers-the most-watched primary debate in cable history. According to Nielsen live-plus-same-day data, the debate beat CNN's previous record of 4.07 million viewers, on 11/15 with the most recent Democratic showdown. The YouTube format allows viewers to submit video questions to the candidates. Nielsen calculations say the debate scored 1.3 million adults 18-49 and 516,000 18-34 viewers. Some 38 YouTube video queries were aired.


One on One
Darren Feher: Running too fast to look in the rearview mirror
Darren Feher, EVP and Chief Technology Officer for NBC Universal, has taken on a new role within the company, focusing more deeply on digital product innovation and emerging technology. He reports to John Eck, President, NBC TV Network and Media Works. Feher's job is to add new technology and engineering teams concentrating on the areas of digital asset management, content distribution, production and commercial planning across NBCU's portfolio of assets. He also continues to lead the company's external industry technology outreach efforts and oversee NBCU's Technology Growth Center (TGC), which houses NBCU's R&D, anti-piracy and technical product development groups for mobile, interactive TV, gaming, and online sites and video. Feher was named EVP and CTO for NBCU in 2003, and has since been responsible for the strategic direction and operational execution of the technical teams that span the company. Prior to joining NBC Universal, Feher worked for GE at the corporate HQ in Fairfield, CT. He filled several technology leadership roles in the IT space as well as a stint as a Six Sigma Black Belt and Quality Leader focused on delivering defect-free technologies and process control.
| Read, The Mission |


Monday Morning Makers & Shakers

Transactions: 10/15/07-10/19/07
After an excruciatingly slow week, radio trading picked up big time, led by Skip Weller's pick-up of a resold Clear Channel package. Ten other radio transactions landed at the FCC during the week, pushing the total value toward 100M. Television station trading was notable only for its absence.

10/15/07-10/19/07

Total

Total Deals

11

AMs

31

FMs

48

TVs

0
Value
93.751M
| Complete Charts |
Radio Transactions of the Week
CCU redo and then some
| More...
|
TV Transactions of the Week
Dormant for a third week



Transactions
583M WBTV-TV Charlotte NC (CBS/3); WCSC-TV Charleston SC (CBS/5); and WWBT-TV Richmond VA (NBC/12) from Lincoln Financial Media Company to Raycom Holdings (Paul McTear). Stock transaction. In Richmond, Raycom owns WTVR-TV CBS/6 and has an SSA with WUPV-TV CW/65, most likely requiring a spin-off. [File date 11/19/07.]


Stock Talk
A mixed bag
Television stocks were fairly mixed on Friday, as the Dow closed the week on a good note and the month down 4%. LIN TV was up a healthy 1.03.


Stocks

Here's how stocks fared on Friday

Company Symbol Close Change Company Symbol Close Change

Acme

ACME

3.15

+0.09

Lincoln Natl.

LNC

61.57

+0.86

Belo

BLC

16.56

-0.24

LIN TV

TVL

11.22

+1.03

CBS CI. B CBS

27.43

+0.17

McGraw-Hill

MHP

49.08

+1.47

CBS CI. A CBSa

27.35

+0.11

Media General

MEG

24.77

-0.31

Clear Channel

CCU

35.90

+0.30

Meredith

MDP

55.05

+0.07

Disney

DIS

33.15

+0.34

News Corp.

NWS

21.68

+0.19

Emmis

EMMS

4.31

+0.04

Nexstar

NXST

9.07

+0.15

Entravision

EVC

7.48

-0.16

Ion Media

ION

1.37

-0.01

Equity Media EMDA 2.20 +0.10

Saga Commun.

SGA

6.83

-0.13

Fisher

FSCI

40.73

-0.59

SBS

SBSA

1.92

+0.19

Gannett

GCI

36.75

+0.29

Scripps

SSP

43.45

-0.36

Gen. Electric

GE

38.29

+0.15

Sinclair

SBGI

10.35

-0.03

Google GOOG

693.00

-4.00

SWMX

SWMX

0.02

unch

Gray

GTN

8.51

+0.51

Time Warner

TWX

17.26

-0.03

Gray, C1. A

GTNa

8.30

unch

Tribune

TRB

31.04

+0.05

Hearst-Argyle

HTV

19.58

+1.09

Wash. Post

WPO

806.50

+4.26

Journal Comm.

JRN

9.10

+0.15

Young

YBTVA

1.41

+0.10


Bounceback

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Below the Fold

One on One
Darren Feher: NBC Universal
Running too fast to look in the rearview mirror...

Ad Business Report
"Mas Vale Tarde" launches
With Coors, GM, T-Mobile, Target

Media Business Report
Entravision looking
To peddle billboards but maybe not for much longer...

Best Buy upgrades
Their sites, targets Hispanics...

Washington Business Report
Will FCC put placement
In its place w/Advertisers increasingly trying to weave their products into the sets...


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More News Headlines

All in the family
The Family Friendly Programming Forum is honoring 11 television shows for being, well, family friendly. Although the Phil Keoghan-hosted ceremony will not air until 12/27/07 on The CW Network, the taping has already been completed and the winners announced. The envelope, please:

* Comedy - Ugly Betty
* Drama - Heroes
* Actor - Zac Efron
* Actor - Kyle Chandler
* Actress - America Ferrera
* Miniseries or Special - Planet Earth
* Movie Musical - High School Musical 2
* New Series - Pushing Daisies
* Cable Series - Kyle XY
* Reality - Are You Smarter than a Fifth Grader?
* Favorite Newcomer - Zachary Levi

Entravision looking to peddle billboards
Multimedia Hispanic operator Entravision sells advertising on radio, on television and on billboards, but maybe not for much longer in the latter category. It has retained Citi and Moelis Advisors, part of Mercanti Securities, to help it explore strategic options with its billboard group. It has about 10.4K faces mainly in the New York and Los Angeles markets. The billboard wing of the company operates as Vista Media.

Best Buy upgrades sites, targets Hispanics
Best Buy is making significant changes online and to its 900 stores, launching an extended return policy, the addition of customer assistants, an improved website, an increased selection of gift cards, shortened transaction times and targeted Hispanic initiatives. Best Buy has reassigned 30% of its sales floor labor to a new cross-trained Customer Assistant position, allowing for deeper personal interaction with customers during peak times. BestBuy.com/espanol, launched in November, offers bilingual content on more than 12,000 products, including service plans and gift cards. Best Buy is also making the research process easier by enhancing its Web site, including the addition of customer reviews and an expanded home theater guided selection tool.


TVBR News Analysis

Exxing out Exxon, thinking about XM
We fired Exxon last week. And the story gives a perfect illustration of why satellite audio services XM and Sirius should not be allowed to merge into a monopoly. Here's the reason we gave the money-grubbing morons at Exxon their walking papers: After at least 17 years using their credit card and buying their gas for two automobiles, we paid a bill one day late. One day. The same imbeciles who paid that Jabba-the-Hut CEO guy hundreds of millions of dollars just to retire apparently couldn't survive for a whole day without our 100-dollar plus check. So not only did they hit us with a 29 dollar late fee, they also tacked on about 2.50 more to finance this momentous transaction.

So that's how they treat loyal long-term customers. We're not taking that kind of crap. We immediately tore up our cards, called them up and fired them. They have our extra 32.50, but they can now try to get along without our one-hundred-plus dollar monthly check in perpetuity. We can take this action, too, because even though there does not seem to be as many companies selling gasoline now as when I was a kid (consolidation is everywhere), there are still plenty of options. So here's our question. If we subscribe to XM, or Sirius, and we decide we want to leave for whatever reason, but they've been allowed to merge, what's our recourse?

The answer is there is no recourse. There is no other way to get 100+ channels of professionally programmed material, available in our car no matter where we drive. Neither AM-FM radio, nor a laptop computer, nor an iPod, nor anything else we can think of can even come close to filling that role if we decide to fire the merged entity. The only thing regulatory agencies should be demanding is that XM and Sirius make interoperable receivers available the way they were supposed to in the first place, and perhaps put some limits on the term of subscriptions so consumers have meaningful ability to move from one to the other.

TVBR Note: But merge? That should be completely out of the question.



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

WGA Strike Central, Day 26
WGA, AMPTP still talking; no breakthroughs
The WGA and studio reps for AMPTP have agreed to keep talking, and have been each day since they agreed to resume talks. However, we're hearing there's some stagnation. Reportedly, most of the discussion in the sessions held has amounted to how to agree to move forward in seeking a compromise on new media residuals.
11/30/07 TVBR #233

Clear Channel gets
clearance to spin TVs
A 13.7B transaction sending 35 television stations and associated low power properties to Newport Television has been given a conditional go-ahead from the FCC.

TVBR observation: How much control does an equity backer exert on localism in broadcast programming? We'd guess not much, other than to support it because generally it's a good business practice. But with cash in short supply, we'd have to think twice about the ultimate affect on public interest that would follow chasing money out of the business. It Newport/PEP competitors aren't motivated to protest this transaction, we can't muster much enthusiasm to protest it either. Assuming the deal does go to closure, it should in fact offer some opportunity for small and/or minority/female-owned businesses to score a station. But beware, Mr. Copps. They too may need a company similar to PEP to help them do it.
11/30/07 TVBR #233

Defending your license, NJ-style
Fox's MNT/9 station in the New York metro, WWOR-TV, faced critics concerned that it focuses too much on serving: The New York metro. Led by Sen. Frank Lautenberg (D-NJ), they told an FCC-sponsored forum that the station should pay more attention to the New Jersey residents in and around its Secaucus NJ city of license.
11/30/07 TVBR #233


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