Syndie barter battle

Feb 25, 2002  •  Post A Comment

Meredith Broadcasting Group President Kevin O’Brien has declared war on Paramount Domestic Television Distribution.
Mr. O’Brien sent a letter Feb. 11 to Paramount Domestic TV President John Nogawski-sending copies to 132 of his TV peers-stating that no Meredith station would ever clear a show in which the barter split gives the syndicator more than 31/2 minutes of ad time.
That’s a direct swipe at NBC’s owned stations, which cleared Paramount’s new strip “Life Stories” with a 10-4 barter split.
Meredith-owned Fox affiliate KPDX-TV in Portland, Ore., had been interested in “Life Stories” (once known as “Life Moments”) until, Mr. O’Brien wrote, “I recently discovered that due to the NBC O&O clearance, the barter split has been increased to 10-4. This is disappointing and unfortunate. I suppose this is what happens when the plastics industry meets broadcasting.”
The latter comment is a reference to Jay Ireland, who was a rising star in NBC parent company General Electric’s plastics properties for much of the decade before becoming president of NBC Television Stations in 1999.

“The letter speaks for itself,” is all Mr. O’Brien would say when he called from Salt Lake City, where Electronic Media later learned, he was the houseguest of Mr. Nogawski.
Mr. Nogawski said he invited Mr. O’Brien to stay with him and take in the Winter Olympics long before being surprised by the letter. “I wasn’t going to disinvite Kevin,” he said.
Stephen Doerr, senior VP for news, programming and creative development for the NBC-owned stations, said Mr. O’Brien’s comments were a “cheap shot at my network and my boss” and are off the mark.
“If he’s going to take cheap shots, at least he should do his homework,” said Mr. Doerr, who added that he negotiated the deal for the NBC stations and that rather than Paramount “convincing Jay Ireland that a barter increase for `Life Stories’ would result in lower license rates,” the suggestion that Paramount take an additional 30 seconds of barter time “came from our side of the table.”
Mr. Doerr hopes the Paramount-NBC Stations model is the wave of a future in which stations and suppliers work together to develop effective syndicated programming (one local segment can be subbed into each hour of “Life Stories,” which focuses on turning points for women), to lower the risks and costs of launching it and to share in the payoffs.
“I think I know a good deal when I see one. I’m fairly confident this is a good deal,” said Mr. Doerr, who described the license fee as “reasonable.”
Sources said the NBC stations’ combined license fee is less than a single station’s bill for “Rosie O’Donnell” in some major markets.
Alan Frank, president of Post-Newsweek Stations, said the 10-4 barter split is “a new threshold, and it’s a problem. We have not taken the show in any of our markets and may not because of this.”
“We hope this is the exception and not the rule,” said Bruce Baker, executive VP of Cox Television.
Cox-owned KIRO-TV in Seattle and WFTV-TV in Orlando, Fla., are among the stations that have agreed to the 10-4 barter-split-plus-cash deal and boosted “Life Stories”’ clearance to more than 70 percent of the country.
“Kevin’s aversion to the extra half-minute is disappointing. It’s too bad,” Mr. Nogawski said, adding that his friend of some 15 years “does a large amount of straight barter shows.”
In his letter to the syndication executive, Mr. O’Brien said, “It’s my position that as long as the barter split is 10-4 this broadcast group will not clear any product with that barter composition. … This is our policy. It will not change.
“I trace the decline of spot television and its place as an important entity in the advertising food chain to the beginning of barter. We’re literally cutting off the limb of the tree, and we’re in the wrong side. It’s my belief that distributors are killing the goose that laid the golden egg. With the insipid and continued growth of barter, this business will not be viable. At that point, you’ll be dealing with satellite and cable operators, who as you know, make us look like big spenders.”
The bottom line of the letter: “We are ready and willing to discuss any programming as long as the barter split is reasonable and remains 101/2-31/2.”