Recession & War En-Gulf Confab

Pinched by the deepening recession and distracted by the outbreak of war in the Persian Gulf, station execs weren’t in a buying mood at this year’s NATPE market.

Indeed, CNN, blaring on tv monitors throughout the convention floor, was drawing larger crowds than many exhibitor displays.

“Clearly people’s attention is diverted – and properly so – from the business at hand here,” said Henry Schleiff, chairman and CEO of Viacom Broadcasting & Entertainment Groups.

“The atmosphere here is definitely subdued,” said WBAL-TV g.m. David Barrett, who cut his stay short. “The heart of our business is news, and you want to be back at home making sure it’s going right.”

But cost-cutting at home also was cutting into dealmaking at NATPE.

“Stations are downsizing in an effort to control costs,” said Mike Levinton, director of programming at station rep Blair Television. “One area that feels the impact very quickly, when the revenue isn’t coming in, is programming. People are simply spending less for product.”

And stations are being much more cautious when they do buy. “Stations are weighing their choices more carefullyand aretaking more time to come to a decision,” said Lucy Salhany, president of domestic television at Paramount. “They are much less willing to take risks. They are renewing programs that have track record and buying the tried and true performers rather than taking a chance on an unknown.”

Correspondingly, the largest syndicators are experiencing strong renewals for their proven shows. Paramount said it has experienced its best renewal season ever with “Entertainment Tonight” and King World Prods. has locked up “Wheel Of Fortune” and “Jeopardy!” in 60% of the country through 1994.

Smaller syndicators pushing new product were hurt most by the somber tenor of the convention.

“You’ve got six or seven big companies doing business here with most of the smaller booths sitting empty,” said King World chairman Roger King. “That hurts the industry overall in terms of creativity and new product. It wasn’t that long ago that we were a small company pushing ‘Wheel Of Fortune.’ Some syndicators are looking overseas for relief.”

International Broadcast Systems, which focuses on foreign markets, shelved plans to get more heavily into domestic distribution at this year’s convention. “If we had to depend on the U.S. for business, we’d be in trouble,” said Earl Jones, president of IBS. “It’s virtually non-existent.”

But foreign markets are also beginning to feel the effects of recession. Kirsten Beck, vice president of international development at Daniels & Associates, said that while the international market is still more exciting than the domestic market it is much less buoyant than it was just three years ago. She said many of the stations and satellite services have filled their pipelines in the past year and are not buying additional programming if they can avoid doing so.

Recession is increasingly reshaping the industry. As business gets softer, industry sources say stations are placing a greater emphasis on barter advertising. “In the short term, stations prefer to use inventory that they have rather than spend the cash,” Paramount’s Salhany notes.

Some industry sources fear bartering will come back to haunt both stations and syndicators; a shortfall in advertising dollars would not cover some shows’ production and marketing costs and thus could tempt producers to skimp on their budgets.

Other changes were evident around the convention floor. Both the number of NATPE attendees and exhibitors were down from last year. “Normally you see from five or six people from each station – general manager, program director, promotion manager and three or four sales managers,” said IBS’ Jones. “What you’re seeing this year is one or two guys from a station and often those people don’t even have buying authority.”

Want to read more articles like this one? SUBSCRIBE TO VARIETY TODAY.
Post A Comment 0

Leave a Reply

No Comments

Comments are moderated. They may be edited for clarity and reprinting in whole or in part in Variety publications.

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

More TV News from Variety