Below Surface At Nbc, Abc Affiliate Meetings - Brief Article - Statistical Data Included

Television Digest with Consumer Electronics, May 22, 2000

Although issues of major concern to affiliates of NBC and ABC TV Networks didn't make it to agendas of separate meetings of 2 groups in N.Y.C. last week, there was much informal talk about same issues. Both groups' meetings were combined for first time with their networks' upfront sales presentations of fall schedules to national advertisers with other networks also making their upfront presentations last week.

It wasn't "bash the network" at NBC affiliates' meeting in N.Y.C. May 14 - as was case in Las Vegas during NAB convention (TVD April 17 p9) at which NBC was roundly criticized for dealings with affiliates in general (most particularly huge cuts in compensation) and in particular announcement that it would rebroadcast evening news on Pax TV Network within hour after it aired on NBC. That action since has been postponed by NBC (see below), major reason cited for affiliates' noncombative discussions in N.Y.C. Jack Sander of Belo Bcstg. was elected chmn. of affiliates' board, succeeding Alan Frank of Post Newsweek Stations.

NBC hosted outdoor reception for affiliates that evening, and May 15 invited them to upfront presentation of new fall schedule to advertisers. (Day before upfront presentation, NBC had signed 6 stars of popular and long-running show Friends to 2-year contracts at $750,000 per star per episode, plus 1% of syndication profits from producer Warner Bros., in near-record $40-million deal.) Affiliates and network executives didn't have usual separate closed meeting for stations to express their concerns.

Large group owner with NBC affiliates speculated that reason NBC dropped plans to put its Evening News, anchored by Tom Brokaw, on Pax TV starting May 1 within hour after it aired on NBC, was that he and other groups told network if that happened they would simply drop NBC's evening news. "They're asking me to promote my competitor and I'm just not going to do that," he told us. He said he was willing to pay NBC for advertising it wasn't able to carry in his markets.

Lawyer for several large groups took similar position, telling us he had advised client not to carry NBC's Evening News if same news was on Pax TV. NBC hadn't responded at our deadline to request for comment on major groups' threat to drop Brokaw.

Many of same TV groups are upset with ABC because that network is insisting on renegotiating affiliation contract when station changes hands, even though contract still has several years to run. "That's a clear violation of the spirit of the network-affiliate relationship," group executive told us. Network is "killing localism by trying to control everything from New York and Los Angeles," he said. "That's why we're opposed to increasing the ownership cap."

We're told ABC is only network insisting on rewriting contracts in this day of network's drastic cuts in compensation as affiliations expire although NBC made strong threats about affiliation in its unsuccessful efforts to acquire KRON-TV San Francisco (TVD Feb 28 p43). We're also told that ABC affiliates' board made "a pretty strong pitch" to network that to insist on contract changes when station is sold "was just dumb." Also at ABC meeting, Andrew Fisher of Cox Bcstg. made what we were told was well-received pitch for stations to become more actively involved on their own in Washington legislative and regulatory matters. His presentation was made on behalf of Network Affiliates' Station Assn.

"Whatever works in new world" of changing communications industries, "we're going to be doing it," ABC parent Disney Co. Chmn. Michael Eisner assured TV affiliates at closing session of their convention in N.Y. May 17. He and Disney Pres. Robert Iger (former CEO of ABC and to whom network still reports) said they were appearing before affiliates because of that changing world, with ABC's well-publicized dispute with Time Warner Cable prime example (see separate story).

Iger said new negotiations getting "our content on the air is our number one priority," along with protecting retransmission consent. Eisner said cable, through its control of distribution facilities, still has upper hand over broadcasters in retransmission negotiations. Disney executives pledged that ABC would work more closely with its affiliates in future - promise several station executives called encouraging .

Asked by affiliate where industry will be in 5-10 years, Eisner responded: "Probably, we're going to want to own more stations" - major area of controversy between network and affiliates, with stations violently opposed to increase in 35% ownership cap. Iger predicted very slow rollout of DTV and said there would be little or no multiplexing by TV stations. Asked about stalled launch of planned ABC SoapNet channel (which has been strongly opposed by affiliates), ABC TV Network Pres. Alex Wallau conceded there's not sufficient national coverage to start channel successfully. He promised stations would be kept updated on network's effort to start channel offering same-day repurposing of daytime soaps.