Fox Television Stations has terminated its agreement with station rep giant Petry Media Corp. to jointly operate its Fox Television Sales subsidiary, effective June 25.
The termination brings to an end the 15-year national sales representation agreement between the two just four years into the deal. Fox’s 22 owned stations are estimated to represent up to $750 million in annual ad billings, about 34 percent of Petry’s total annual billings of $2.2 billion.
A fissure developed, according to senior-level Petry sources, over an estimated $40 million Fox owed on the 4 percent commission structure paid to Petry as well other operational losses. On an annualized basis, Petry claimed the rep firm earned around $30 million in commissions per year through sales, back-office traffic and administrative support.
In a letter, a portion of which was read to Electronic Media, PMC President and CEO Tim McAuliff explained to employees that the joint management of Fox Television Sales worked “disproportionately in Fox’s favor.” The letter also suggested Petry management, including Chairman Arnold Sheiffer, “tried to address some of those issues” with Fox over alleged operating deficits and back compensation due on commissions.
Jim Burke, president of Fox Television Stations, declined to comment on whether Fox is in arrears to Petry and if any sort remuneration is due to Petry. “This is a decision entirely relative to our stations further maximizing our market position and performance under a uniform in-house [sales] structure,” he said.
Mr. Burke said Debbie Carpenter, vice president and general manager of Fox-owned WTTG-TV, Washington, has been named senior vice president of Fox Television Sales. Ms. Carpenter takes over for Bill Shaw, who was president of Fox Television Sales but is now expected to be re-assigned, along with other staffers, to other posts within Petry Television or Blair Television. Before the Fox Television Sales partnership, Mr. Shaw was president of Petry Television.
There have been rumblings in the rep community that Fox Television Sales may also serve as the full-time umbrella sales organization for the regional Fox Sports cable networks. Packaging deals involving some Fox TV stations and Fox Sports networks already have been done in markets where they jointly own TV rights to professional sports franchises.