Upon reading news today of NBC Universal slashing 500 jobs and Viacom cutting about 850 jobs, I began wondering how are things evolving locally. I think some of the cuts at NBC, Viacom and other networks were going to happen whether the economy took a turn or not, because of changes in technology and media consumption. However, the economic downturn stirs the pot even more and accelerates change in the media world. I have found it interesting in reading articles and watching stories about the economic problems how the example of local car dealers' slumps across the country have forced them to cut back on advertising in newspapers, radio and television. Not only are these stories appearing in trade publications, but also on shows and publications watched and read by the mainstream population. Its been awhile since I have heard of any large layoffs happening in Wichita at TV stations. There have been comments made to the posts that one station isn't replacing people when they leave and making 1 person do the job of a couple. Is it just a matter of time before we hear of big cuts in this market? Or are Wichita stations already dealing with minimum staffs and there are no cuts to make? With technology and the economy influencing the business at identical times, it will be interesting to see what happens. I am curious to hear your opinions.
KPTS Larry Hatteberg Special - KPTS airs a special called, "Larry Hatteberg's Kansas People," Tonight at 7PM on the local PBS station. It re airs Sunday, December 14 at 6PM. The website describes it as "collection of some of his favorite stories from the television series on KAKE TV." The special happens to run during one of the station's fundraising drives. -Hal
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30 comments:
Yawn.
Here we go again.
Imitating twelve troll:
"KWCH has tons of money.. we're great... KAKE's stock is the toilet. KSN sucks"
Boring.
The issue with media companies are that they aren't hitting the 30%+ margins they've been used to getting for years.
They are practically zero business that are accustomed to such wide profit margins. On average US manufactures only making 5.6% margin. Exxon 7.8% margin. True Exxon rakes in huge amount of cash... but that margin is microscopic compared to the expectation of media companies.
Yes... the advertising picture isn't pretty -- and its bound to get worse.
But, at some point, carmakers will need to advertise the cars they need to sell. Furniture stores will eventually be in the same boat.
Moving on, large media companies have tons of middle level employees and management.
They are laden with bureaucracy. Try emailing someone at a network.. and watch how many people in the food chain in different departments weigh in to address one issue.
This is what they are targeting with the cuts.
As far as NBC goes, Zucker should have never been made network president.
What you are seeing is a mature business trying to figure out how to be more efficient, yet hold on to unreasonable margins.
I can almost guarantee to you that all three stations are making a profit in this market ... trouble is, its just not enough.
As far 1 employee doing 2 jobs... Sucks to be sure.
But, I'd rather be the employee with multiple skills... because that opens up more opportunities with other employers down the road.
That may be how things work at Gray (KAKE) or Media General (when they owned KWCH) but when you are a solid company with a handful of stations that are financially secure and profitable (current KWCH parent Schurz for example) those kind of problems and middle levels of redundancy aren't there.
Aside from this boring topic, it's nice to see one station actually doing investigations all the time now and not just in sweeps. KWCH is actually doing real news, in addition to the day of event stuff. Maybe the shallow, no depth, people at KAKE and to a lesser extent KSN could learn a thing or two.
BTW: Why aren't they HD yet?
I found it interesting that KWCH's web story regarding the Oklahoma dog story lists that three of the animals has died. Their TV story mentioned that two of the animals had died. In reality, only one of the dogs has died. I wonder what other facts KWCH gets wrong.
KWCH Troll take note, I am about to say another nice thing about your favorite station. Thursday's investigation by Michael Schwanke on a group paid $60,000 by Wichita State to transport students and their cars safely, only to discover they hired a driver who is a covicted rapist was well done. Everyone involved talked to Mike in the story and it was certainly an interesting piece. -Hal
8:13...facts change. You are just behind and wrong with your information KAKE troll.
Had 8:13 actually read the story they would have found out that 2 of the dogs had to be put down (earlier in the day which was reported at 5 and 6) and the other died later on.
1+1+1=3
That's math even you at KAKE can understand. Care to retract your lie?
Anon 810
Idiot.
I was talking about networks. Hal post touched upon NBCs 500 cuts and Viacom cuts as well.
I was trying to explain some of the issues behind that.
But no... you simply used this as another chance to make yourself feel good about the almighty 12.
Anon 811 is a troll as well.
BTW, I've see KSN do sweeps style piece outside of the book as well.
An earlier post misses the point when he talks about TV Stations OPERATING margins. True, if you don't count the companies DEBT, they're doing OK. Not great, but admittedly OK.
Problem for Gray is--they have more than $800 Million of DEBT. Thats $800 Million in Debt for a company that is worth $18 Million.
Every single penny they earn on operations goes to Debt payment. They don't have a nickle left to invest in things like new canmeras, facilities, pay raises..Unless they want to add NEW DEBT.
And the s-- has hit the fan because no one will buy new debt for a company like Gray for anything less than 25% interest (if THAT).
2009 is going to be the most difficult year in the history of Broadcast TV, by a very large margin. I wish everyone the best.
Anon 6:32,
Please learn business 101 before you make an idiot of yourself again.
From Gray Television, Inc. Q3 2008 Earnings Call Transcript:
Turning to balance sheet items for a moment. Cash at the end of the quarter was at $32.6 million and early October, we voluntarily prepaid on our term loan of $10 million. Debt at the end of the quarter was $830.4 million and after that $10 million in early October, it is stand at $820.4 million.****
While not a fan of gray, their worth AS A COMPANY is significantly more than the $18 million you said it is. KAKE and its facility/business assets and revenues alone would likely garner more than $10 million on the open market.
While gray is definitely hurting and is isolated from the eyes of potential buyers, those venture capitalists are staying away from all media companies right now.
You must be a producer or reporter since you did only basic research before enlightening us with your post.
So please learn the basics of business valuation before opening your trap.
Sincerely yours,
Someone obviously smarter than you.
Anon9:31, I know considerabnly more than you do on this matter.
Let me teach you a lesson on how the marketplace "values" a company.
You take total shares outstanding and multiply by the price per share. There are 48 Million shares and at this very moment GTN is trading at 43 cents per share. The market capitalization is $21.1 Million. Thats what its worth
You accurately point out the company's total debt load of over $800 Million.
You accurately state that the company has cash on its balance sheet.That IS ALREADY CONSIDERED in investors calculations of value when establishing a "stock price" or "value" for the entire company.
GTN IS draining that cash and DID NOT vote to issue a dividend at its BOD Quaterly meeting (for the first time in MANY years).
Whatever "value" GTN has is simply overwhelmed by a total debt outstanding that simply dwarfs all other considerations,. Its why the company is trading at 43 cents. You can buy up all the shares and effectively control the company for $21.1 Million.
All of the poceeds KAKE, its affiliates and the 30 + other stations generate goes to pay INTEREST on the massive debt. EVERY penny. And analysts estimate NEXT year--GTN will need every penny--PLUS another 17-30 cents per share.
Not pretty,...not viable.
good lord! don't you guys have JOBS?? or is the above mess something you participate in for FUN?
Interesting how KWCH has Mark Larson work the evening shift Friday while he worked the evening shift too all while the most recent meteorologist hire Anya was sitting in the office behind him
Anon 135 PM,
Your comment doesn't make since. Did you mean Mark worked the morning AND then also the evening with Anya sitting behind?
Yes sorry I meant Mark Larson worked morning, then evening Friday
TV Spy has a post that Gray is very close to layoffs if they haven't already.
Has anything hit KAKE yet? With things already tight over on West Street, do they have anyone they can afford to get rid of?
Would you allow Ayna to do your late show? I didn't think so. Sorry, she's horrible and has shown no sign of improvement since she began.
Whats amazing to me is, you can buy the ENTIRE Gray Television Company (36 stations) for much LESS than what Gray paid for KAKE alone.
Its a nice time to have some cash.
Buy 1 TV station, get 35 other stations for Free (as long as you assume the debt).
KSN is in trouble. NBC will soon cut the hours of programming it offers. KSN already offers the last amount of news in the market of the big 3.
Since their ratings are already 4th in the market what will they fill the extra time with, especially since they have the smallest staff in the market? Maybe they'll sit in black between 9 and 10 and then start their "news."
http://www.google.com/hostednews/ap/article/ALeqM5gdFBRfkPt3w_lOAhPicpzVD-0nCwD94UOJRO0
KSN is now reporting and I'm quoting now "chatroom speculation" about the Butler head coach going to K-State under Snyder. Is that what they consider reliable sources over at KSN now? What a joke. I mean it's not even PowerCat and that is a dubious source at best...remember Patterson. Why is their standard over there? Do they even have a standard for what's reportable?
The head of GE, owner of NBC and many local stations, openly speculated about the viability of Local TV News. He said the Late Night Local News is a dying breed, and losing viewership big time. He said he thinks the Network TV business is "troubled" but says the situation for LOCAL TV is far worse (and he owns a large group of stations).
Yes, KSN has issues but KWCH's network is a mess outside prime time and ABC isn't much better. I really think markets like Wichita will be 2-station news markets.
The owner of one station calls another station and says "hey, here are the keys--take over my debt payments, consolidate operations, and see if you can make it work". It'll be interesting.
In all seriousness, I wonder if there will be a media bailout. Newspapers are going out of business, the Eagle is on life support, you know the situation in local TV, and the largest radio groups are on the verge of Bankruptcy.
KSN has a dubious history of reporting to say the least---remember BTK and Valadez.
The only good thing about KSN- barbara baan...yummy!
KSN is not in trouble. They are better now than they have been in the last few years. Their company is a solid one, or at least more solid than a lot of the other tv groups currently out there across the country today.
KSN is a victim of being an NBC affiliate. So what? They'll get through it.
People- don't we have enough to worry about with the economy and the state of affairs to keep flaming and spilling this "doom and gloom" over each other? Come on, grow up. The people saying "KSN is in trouble..etc" know deep down in a year from now, heck, in 3 or 4 even, its a very safe bet KSN will still be around.
Leno is going to fill that hour.
Hey, Anon 4:51
It's called JAY LENO. How's that for a lead-in for the local news?
-Jay
Don't start this Snyder debate again in this topic... the last topic had a lengthy discussion about this and there were no winners.
However, I agree with you.
No one watches Leno after the first guest. It's a crappy lead in. Besides when no one trusts your news product it doesn't matter what your lead in is.
KSN and all NBC affils are screwed. Leno pulls in only 4.8 million viewers a night. NBC expects to only bring in 5.5 million at 10pm on his new show. That's less than what the tankers on NBC are doing now. Ya it's cheaper for the network but local affils are screaming. Last week, 3 CBS shows pulled in 18 million viewers, 18 on an off week. If anything this is good news for CBS and ABC. NBC has permanently given up being No. 1 or 2 ever again by this move.
Gray station WOWT laid off people last week. That's in Omaha. I wonder how long until the chopping order is given at KAKE. Has it been given already?
Why is KAKE running crawls about their cable providers out west? Are they about to get yanked?
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