WASHINGTON — NBC has informed the National Assn. of Broad-casters that it may exit the trade org as part of a companywide cost-cutting effort.
NBC senior vice president and general counsel Rick Cotton confirmed Tuesday that he had discussed a possible departure with NAB president Eddie Fritts. Cotton said the impetus for the action is part of the web’s efforts to cut costs, but he said the trade org’s opposition to ownership deregulation will also play a role in the decision.
There has been tension between the NBC and NAB over the trade org’s position on ownership issues for more than a year. NBC wants the NAB to use its powerful lobbying muscle to push for more deregulation, but the org’s affiliate members have opposed the effort. The result is that NBC and the other major webs are finding themselves lobbying against NAB on the key ownership issue.
The networks argue that they can’t survive unless they are able to own more stations than are allowed under the current cap. That cap limits net-works to a 35% national audience reach for its owned stations. The webs want the cap eliminated, and say they need the revenue from cash-rich stations to subsidize network programming.
Cotton said Tuesday that the ownership issue was “part of the discus-sion” as NBC works through a decision on paying its dues. NBC is asking itself “what are the benefits and what are the costs” of membership, said Cotton.
Fox, also unhappy with the NAB’s position on ownership, has consid-ered leaving the org, but nothing has come of it so far.
If NBC exits, it is not expected to impact NAB’s bottom line. Between membership dues and revenues from annual conventions, NAB hauls in more than $30 million each year.