Monday, May 11, 2009

Advertising Losses Put Squeeze on TV News

The New York Times - It is getting so bad for local television stations that some are turning to newspapers for help.

The bankrupt Tribune Company has merged its TV stations and daily newspapers in Miami and Hartford, and it already produces a lighthearted morning show in south Florida with the help of the newspaper’s columnists. Bob Gremillion, the executive vice president for publishing, calls it a “circling the wagons” approach.

No one would dispute that “the two industries are very challenged,” he said. “We’re combining and fighting together.”

The mergers are an example of local TV’s agonizing search for new business models as some balance sheets turn red. Starting Monday in Chicago, four stations’ news departments are combining their camera crews. In other markets, stations are adding newscasts on the cheap even as they lay off people. On the opposite extreme, a handful of stations are closing their news divisions completely.

The news for stations has been grim lately: without election advertisements to defray the losses in automotive ads, a cross section of station owners reported 20 percent to 30 percent quarterly drops in revenue last week, suggesting that the local TV business is almost as weak as its print counterpart.

“Unfortunately, there was nowhere to hide during the current storm, as declines in both local and national advertising accelerated,” Timothy E. Stautberg, the chief financial officer for the E. W. Scripps Company, which owns newspapers in 14 markets and TV stations in 10 markets, told investors last week.

About two-thirds of Americans say they regularly get news from local TV, according to the Pew Research Center. News is responsible for 40 percent to 50 percent of a station’s revenue on average, and many stations are still profitable. But owners see their audiences splintering and they see their parent networks bypassing them on the Web. What they are struggling to maintain is relevance.http://www.nytimes.com/2009/05/11/business/media/11local.html

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