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Apr 14, 2004  •  Post A Comment

Shelley Ross Named ‘PrimeTime’ Executive Producer

After months of rumors ABC News will indeed make Shelley Ross executive producer of “PrimeTime Thursday,” a move Ms. Ross has resisted mightily but would seem to secure Charlie Gibson as Diane Sawyer’s co-anchor.

Mr. Gibson, who has built up a lifetime’s worth of good will at ABC News, had by all accounts refused to stay with “GMA,” where he and Ms. Sawyer have been the “temporary” anchors since 1999, if the hard-driving Ms. Ross, whom he believed catered to Ms. Sawyer, continued to be executive producer. A number of other key “GMA” staffers were also said to have been worn out during the Ross regime and in danger of leaving the show.

ABC News is expected to name Ben Sherwood, an alumnus of ABC News’ old “PrimeTime Live” and NBC News’ “Nightly News,” the executive producer of “GMA.”

Ms. Ross, who also took over “GMA” in 1999, when it was plummeting in the ratings, has earned a great deal of credit for stopping the years of bleeding. She has infusing the show with a snap and sizzle it had not had since the news division took it over from the entertainment division and mucked with the Charlie Gibson-Joan Lunden model that had once made it the most popular morning show. However, there is a sense that “GMA” under Ms. Ross has plateaued with a real gain of some 400,000 viewers. Despite sometimes huge ratings spikes that push it within tantalizing range of “Today,” “GMA” still tends to run a million-plus viewers behind the NBC No. 1 morning show.

And with “The Early Show” on CBS showing sustained growth that once was unthinkable, “GMA” can not afford to stall or lose ground-which would have been likely if the unflappable, versatile and familiar Mr. Gibson were to leave.

Third Vivendi Executive Settles With the SEC: Vivendi Universal’s former chief accounting officer settled with the Securities and Exchange Commission without admitting any wrong doing in connection with a financial scheme that sought to mask the company’s weak financial health from investors in 2002.

As part of the settlement, he agreed not to perform any work for a publicly traded company for three years.

John Luczycki, a certified public accountant, is the third former Vivendi executive to reach such a settlement with the SEC. Former Chairman and CEO Jean-Marie Messier and former chief financial officer Guillaume Hannezo both settled with the agency in December, and agreed not to do work for a public company for 10 years and five years, respectively. Each man also agreed to pay a $1 million fine. Vivendi, for its part, paid a $50 million fine.

DirecTV Wins Lawsuit Against Pegasus: A federal jury in California on Wednesday ordered satellite company Pegasus Communications to pay DirecTV Group $51.1 million in damages to settle a breach-of-contract dispute between the two companies.

The lawsuit involved a joint marketing contract in which DirecTV claimed Pegasus failed to honor. The award represents the amount Pegasus failed to pay DirecTV in connection with that marketing pact. The court is slated to consider separately a DirecTV request to be paid $11 million in prejudgment interest.

The verdict is the latest in a string of legal tussles between the two companies over a series of agreements between them over Pegasus’ reselling of DirecTV services to rural customers. DirecTV in January settled with the National Rural Telecommunications Cooperative, a coalition of small satellite operators, allegations that DirecTV was circumventing the NRTC and selling services directly to rural customers.

However, Pegasus, which was a member of the NRTC, declined to agree to the terms of the settlement and is seeking a legal remedy. A motion hearing on this matter is scheduled for April 28.

Both companies said Wednesday’s verdict has no bearing on the resale fight.

Sinclair, Gray Raise Revenue Estimates: A pair of station groups reported Wednesday that they expect their first-quarter revenue figures to exceed previous estimates thanks to stronger-than-expected advertising in the political sector.

Sinclair Broadcast Group said preliminary first-quarter net broadcast revenue should hit $158.3 million, nearly a 4 percent increase over the year-earlier level and 1.5 percent higher than Sinclair’s previous first-quarter estimate announced in February. The company attributed the higher number to stronger-than-expected local and national advertising and political advertising, which included $1.3 million more in spending than anticipated in key election states such as Ohio, Florida, West Virginia, Illinois and Maine.

Meanwhile, Gray Broadcasting said its first-quarter revenue should be up 15 percent to $74.7 million versus previous guidance of $72.5 million. In 2003, revenue was nearly $65 million.

The company said its broadcasting revenue should hit $61.9 million up 18 percent from a year-earlier figure of $52.6 million. Previous estimates pegged broadcasting revenue at $60 million. Gray also said its political advertising revenue would come in at $3.5 million, up 369 percent from $741,000 a year earlier. Earlier estimates pegged the political revenue at $2.5 million.

BET Announces New Shows for Next Season: Black Entertainment Television late Tuesday said it is introducing a handful of new specials and series to its 2004-05 season as the network moves to secure its place as the No. 1 cable destination for African-Americans. The announcements were made in New York at the network’s first-ever upfront.

Among the new series slated to debut next season are “Style” an entertainment show, and “On & Off,” a series that showcases the lives of music stars at work and at home. In an effort to promote voter registration, the network is also launching “Speak Now,” a series dedicated to discussing issues relevant to African Americans.

BET is also debuting a few specials, including a concert series and an awards show for the best comedian. This is in addition to strong performers such as its yearly “BET Awards” and “BET Walk of Fame.”

Hale Named KTTV/KCOP General Manager: Kevin Hale has been named VP and general manager of Fox-owned KTTV-TV and KCOP-TV in Los Angeles and of Regional Sports Net West sales. Mr. Hale had been VP and general manager of Fox-owned KSAZ-TV in Phoenix, Ariz., since 1998. He succeeds Dave Boylan, who left last year.

“Kevin has played a significant role in KSAZ’s impressive growth and his past successes make him the perfect candidate to head our Los Angeles duopoly,” said Fox Television Stations Chairman Lachlan Murdoch. “We look forward to his direction and leadership in continuing KTTV’s and KCOP’s current successes.”

Mr. Hale joined the Fox-owned station group in 1997, when he was named VP and general manager of WHBQ-TV in Memphis, Tenn.

FCC’s Ferree Intros Plan to Complete Transition to Digital Channels by 2009: Ken Ferree, chief of the Federal Communications Commission’s Media Bureau, unveiled a controversial plan today that he said would all but guarantee that the broadcast industry switches to digital TV no later than the beginning of 2009-essentially by changing the agency’s must-carry rules to switch a broadcaster’s cable carriage rights from its analog to its digital channel at that time.

Under the major provision of the plan, according to Mr. Ferree, cable operators would have the leeway to meet their obligation to ensure that a must-carry broadcaster’s digital signals were available to all of their customers by converting the broadcaster’s digital signal to analog at a system’s headend.

Under the original DTV game plan, broadcasters were given a new channel to help them make the switch to digital by the end of 2006, at which point they were supposed to return their analog channels to the government to be auctioned off. But under a major loophole in the law, broadcasters are free to keep both their analog and their digital TV channels until 85 percent of the homes in their community are able to receive digital.

At a press conference today in Washington, Mr. Ferree-like many other industry observers before him-said that without some sort of major shift in the ground rules, the
85 percent mark is unlikely to be hit for decades. “My kids will have died by the time this happens,” Mr. Ferree said. But under his new proposal, Mr. Ferree said that cable’s subscribers would all be counted toward the 85 percent mark as of 2009, even though they may ultimately be receiving an analog feed from their system. Broadcasters made clear that they will oppose Mr. Ferree’s plan, in part because it would force consumers to buy digital-to-analog converters for the more than 80 million TV sets that aren’t currently hooked up to cable or satellite.

In addition, broadcasters are alleging that the proposal could derail the DTV transition altogether by robbing the incentive of cable’s subscribers to buy a DTV set. “If those signals are going to be down-converted to analog, why would I as a consumer go out and buy a digital TV set?” said one broadcast industry source, who asked not to be identified.

Added Dennis Wharton, a spokesman for the National Association of Broadcasters, “NAB remains concerned that the Ferree initiative is simply a spectrum reclamation plan that would strand both consumers and broadcasters who have collectively spent billions embracing the best television technology on the planet.”

But Mr. Ferree questioned the motives of broadcasters. “They’d rather eat their children than give up this spectrum,” he said. Mr. Ferree also said the government-planned auctions of the broadcasters’ analog channels could raise “tens of billions of dollars” for the U.S. Treasury-and that he would recommend that some of that money be used to subsidize consumer acquisition of digital-to-analog converters.

The media bureau chief also said the auctions are important because the spectrum could be used to create new business opportunities in the United States instead of ceding the upper hand to foreign-based companies. “Do we want to be left behind in this race?” Mr. Ferree said. “I think the answer is no.”

Scripps Reports Gains on Strength of TV Assets: Based on its first-quarter numbers, E.W. Scripps Co. might have to start identifying itself as a television company first.

The Cincinnati-based company that has long been known as a newspaper owner reported first-quarter results that spoke otherwise, as its television stations and cable networks helped the company produce double-digit gains in profit and revenue and contributed more to the bottom line than the company’s newspaper business.

Scripps reported a 34 percent jump in first-quarter profit to $70.5 million, or 86 cents a share, compared with $52.7 million, or 65 cents a share, a year ago. Revenue rose 15 percent to $514 million.

The company said that its Scripps Networks, the division that runs cable channels Food Network, Home & Garden Television, DIY-Do It Yourself Network and Fine Living, fueled most of the growth in the quarter, posting a 50 percent surge in profit to $62.3 million and a 36 percent jump in revenues to $159 million.

Advertising revenue at Scripps Networks climbed 31 percent to $122 million, while affiliate-fee revenue soared 53 percent to $33.9 million. Programming costs rose 39 percent to $38.1 million.

Looking at individual networks, the company said HGTV, which now reached 86 million households, contributed $44 million in segment profits, a 27 percent jump from the year-earlier period. Revenues rose 27 percent to $85.1 million. Food Network, which Scripps owns jointly with Tribune, reported a $27.1 million contribution to segment profit, up 51 percent from last year, and a 40 percent increase in revenue to $63.1 million.

Scripps Networks’ newest channels, DIY and Fine Living, produced mixed results. Though DIY’s segment profit fell 35 percent to $2.4 million due to development costs, the network reported a 94 percent increase in revenue to $6.8 million. The network was in 15 million households at the end of the quarter. Fine Living saw a 27 percent decline in profit to $5.2 million due to development costs, yet reported a 270 percent increase in revenue to $3.7 million.

Meanwhile, the company’s 10 broadcast stations contributed to the bottom line with political advertising reaching $4.2 million in the quarter, surpassing both the first quarter 2000 take of $1.7 million and the year-ago figure of $200,000. The 2004 quarter’s political revenue also beat the $3.8 million Scripps’ six ABC affiliates brought in from their carriage of the 2003 Super Bowl.

The strong advertising results helped the broadcast division post a 10 percent rise in profit to $17.2 million on an 8 percent increase in revenue to $75.7 million.

Scripps’ newest segment, the Shop at Home Network, generated strong results as well, posting a 27 percent increase in revenue to $74 million. The unit reported a narrowed loss of $3.6 million vs. year-earlier red ink of $5.9 million.