With the second cycle sale of Two and a Half Men to the Tribune and Sinclair station groups for seven – count ‘em – seven years, and mega deals by Fox O&Os for The Big Bang Theory and Modern Family, you think syndicators would celebrate the return of the big pay day they reaped back in the day. Right?
Think again. In fact, syndicators might want to keep those corks sealed on those champagne bottles.
In Mediapost Monday, LIN TV CEO Vincent Sandusky was critical of the deal and the syndication business in general, saying prices for syndicated fare have peaked and his station group – which includes NBC affiliate WAND-TV in downstate Decatur and CBS affiliates WISH-TV in Indianapolis and WANE-TV in Fort Wayne, Ind. – not to mention other station groups – would be better off developing local programming due to lower costs and the potential of higher ratings and maximizing revenue.
During a recent investor event, Sandusky was quoted as saying"We just don't think shows are going to have those kinds of legs. The days of the Seinfelds coming off net are really over." The Mediapost article also noted LIN will continue to bid for off-network programming – if the price and terms makes sense for the company.
Many local stations are developing programming on their own as a response to escalating license fees for syndicated product and as a replacement for The Oprah Winfrey Show, which is exiting in September. Many stations are traveling down this road because they feel the money spent on syndicated product would be better invested in local programs, rather than finding the next Dr. Phil and winding up with the next Dr. Joy Browne Show or Dr. Keith Ablow instead.
This is what ABC-owned WLS-TV is hoping for with its new 9 a.m. talk show (tentatively titled Morning Rush), which replaces Oprah in September. Instead of poaching Regis & Kelly from sister company Disney/ABC Domestic Television, WLS decided to go back to its roots and launch a local morning show in order to maximize revenue and lower costs. This is what WLS did in the 1970’s by launching A.M. Chicago, which hired Oprah Winfrey to replace Robb Weller in 1984 when he exited to join Entertainment Tonight. The rest is history.
There has already been some local talk show success stories. Milwaukee NBC affiliate WTMJ airs The Morning Blend at 9 a.m., which features a mix of paid advertising segments and unpaid segments (which is a common practice for a few of these shows), while Minneapolis-St. Paul ABC affiliate KSTP runs Twin Cities Live! at 3 p.m., which has hung tough airing opposite Dr. Phil and Dr. Oz.
These are stories some syndicators don’t want to hear. Why? More successful local programs means fewer slots available for their product, which rattles them. For example, the syndication community howled in 1977 when Westinghouse Broadcasting announced it was filling it 7:30 pm prime access time slot with local editions of Evening Magazine every weeknight on its five stations, based on its success at its KPIX-TV in San Francisco (the program later entered national syndication as PM Magazine in a local station cooperative.) One of the reasons Group W developed Evening was because of the dissatisfaction of first-run syndicated product in the marketplace and it stayed true to the now-defunct Prime Time Access Rule, which restricted off-network (but not first-run syndicated) series in the hour before prime-time on network affiliates in the fifty largest markets and encouraged stations to produce local programming.
Today, many station groups have those same complaints. But to be sure, station groups like Fox, Sinclair, and a still-bankrupt Tribune are still paying huge sums of money for syndicated fare and helping dictate the marketplace. But a growing number of station group executives are making syndicators sit up and take notice regarding their grapes about escalating license fees.