Two Is a Party for Owners

NBC executives are being asked to brush up on their Spanish. Viewers in Memphis are watching a UPN newscast produced by the local ABC affiliate. And Dodger fans are seeing games presented with “Fox attitude” and graphics on what was once “Very Independent” KCOP-TV.

These moves are all part of a relatively new game in television known as duopoly, describing a business model in which a company owns two TV stations in the same city. Fueled by an easing of rules governing TV ownership in 1999, the rapidly growing practice is fraying nerves among station employees and prompting consumer advocates to sound alarms.

For the most part, however, this media consolidation has been occurring under the public’s radar while leaving those working in local television wondering when and where the next shoe will drop.

Three duopolies exist in Los Angeles, with the Federal Communications Commission this week approving Viacom’s acquisition of KCAL-TV, giving CBS’ parent company control of two local TV stations (the other being KCBS-TV) as well as several radio stations--including AM news stations KNX (1070) and KFWB (980).

In addition, NBC recently completed its purchase of Spanish-language network Telemundo, meaning the company owns KNBC, KWHY-TV and KVEA-TV (though KWHY will have to be sold to comply with restrictions limiting ownership to two stations per city). News Corp. also acquired KCOP last year, providing Fox’s corporate parent control of it and KTTV-TV in Los Angeles. Programs have already moved back and forth between the stations, from “Seinfeld” reruns to Dodger telecasts.

Moreover, KTLA-TV and the Los Angeles Times are owned by Tribune Co., in a departure from another fading restriction that prohibited a company from owning a newspaper and a TV station in the same market.

The shrinking pool of owners controlling media outlets has clear implications for the TV industry--from employees whose overlapping jobs are being eliminated to advertisers and program distributors, which possess less leverage in negotiating with these bulked-up operations. It’s also anticipated the rules will be further relaxed, prompting more mergers.

The effect on the consumer, meanwhile, remains subject to debate. Critics argue that centralizing broadcast outlets in fewer hands stifles competition and potentially mutes dissenting voices.

“The question that’s not being addressed directly is the whole notion of diversity of ideas in the marketplace,” said Jeff Chester, executive director of the nonprofit Center for Digital Democracy, a Washington, D.C.-based watchdog group.

“The consolidation is all about making the goals of Madison Avenue more viable, and I think we’re going to lose a lot in the process. It’s all about consumers. It’s not about citizens.”

Many broadcasters, by contrast, say an explosion of options has largely rendered such concerns moot--and made consolidation vital if they are to survive in an increasingly fragmented media environment.

For all the business ramifications of duopolies, TV executives insist viewers are not affected. If anything, they say, dual ownership allows some channels that wouldn’t be able to afford producing local news to do so, thus benefiting the community.

Most agree the structure helps stations reduce costs while centralizing decision-making. KCAL General Manager Don Corsini, for example--a market veteran who cut his teeth at KABC-TV--will now oversee both KCBS and KCAL.

Consolidating front-office operations is just one form the cost-cutting can take. There has been speculation about stations merging news assignment desks and sending one satellite truck to events, then sharing footage. One local TV reporter who asked not to be identified called such practices “immensely frustrating,” because fought-for exclusive stories are passed on to the sister station.

“Just in terms of competition, you have to believe that ultimately there’s been something lost,” said Rick Feldman, a former general manager of KCOP, who worked at the station for 16 years before leaving in 1999.

Paired stations have extra clout when it comes to buying programming, bidding together for sitcoms, court or talk shows. Other scenarios include attempting to expand market share by selling advertising time jointly.

Having two stations work in tandem also affects news personnel. KCAL and KCBS won’t compete for talent, which could deflate salaries--especially for rank-and-file reporters, if not highly paid anchors. “Generally, the anchors are their identity,” said agent Ken Lindner, who represents local and national news personalities and can foresee reporters moving between stations while anchors remain exclusive to one or the other.

“As an agent, any time you see jobs dwindling because of resources coming together, it’s of concern,” Lindner said.

The anxiety also extends to union representatives, who see their influence being weakened.

“We’re obviously concerned about the effects of any consolidation, and our interest is to protect our members as best we can,” said John Russum, executive director of the American Federation of Television and Radio Artists’ L.A. branch, which represents anchors and reporters.

Blending KCOP and KTTV has been complicated by the fact that KTTV’s technical employees are represented by the National Assn. of Broadcast Employees and Technicians, whereas KCOP staff is with the International Alliance of Theatrical Stage Employees. The situation is reversed in New York, and Fox is trying to negotiate a bicoastal swap to bring employees under unified deals on each coast.

Union officials say they are hoping station owners will seek to boost revenues, not just slash overhead. “Their main goal is to capture more of the market, not just to wipe us out,” said Keith Hendriks, vice president of NABET Local 53.

Fox and Viacom declined to comment. Yet other TV station owners say they hope duopolies can make them stronger financially and thus better able to serve their communities.

One example cited is Memphis, where, under duopoly ownership, the local ABC station now produces a newscast for the previously newsless UPN affiliate, employing different anchors but the same production team.

“The second station certainly gives you a way to utilize your newsroom in a broader capacity,” said Jack Sander, executive vice president of media operations at Dallas-based Belo Corp., which owns two stations each in Seattle; Spokane, Wash.; Tucson, Ariz.; and Phoenix.

Daniel P. O’Brien, a senior analyst at Cambridge, Mass.-based consulting firm Forrester Research, sees companies combining newspapers, the Internet, cable and broadcast properties to forge regional media powerhouses.

“It’s not economically viable to run these expensive operations when you can’t cover your costs anymore,” he said, adding that the suggestion that diversity is diminished “doesn’t make as much sense in this age of 24-hour cable.”

Some of the most ambitious steps involve NBC and Telemundo, which say they will expand and improve the latter’s programming, especially in regard to news.

“The folks at Telemundo are going to have more resources than they’ve ever had before,” said Ramon Escobar, the MSNBC executive overseeing integration of the two news operations. “Our focus is to ensure that we have the best product in Spanish and in English. These other duopolies have some other goals in mind.... Our focus is on growth, not on consolidating for the sake of consolidating to manage costs.”

Plans are underway to house KNBC and KVEA in the same facility, and sources say certain NBC staffers are trying to learn enough Spanish to provide informed input on Telemundo’s affairs.

KNBC also intends to coordinate Spanish-language coverage of the 2003 Los Angeles Marathon, and its sales department is seeking to “put together attractive packages to include KVEA,” said KNBC General Manager Paula Madison, opening the Spanish-language market to new sponsors. “It’s that kind of synergy that makes this even better than it would at first blush appear,” she said.

Still, cooperative ventures can be tricky, especially when it comes to newspapers and television. Belo, for example, owns the Dallas Morning News and ABC affiliate WFAA. Because the two share news-gathering resources, the company prevents the newspaper from critiquing WFAA programs to avoid conflict-of-interest charges.

Watchdog groups say that is precisely the kind of situation that concerns them. They worry that newspapers will abdicate their traditional watchdog role in monitoring the excesses of broadcast news.

In a less expansive arrangement, KTLA has installed a camera in The Times’ newsroom, affording the station access to the newspaper’s staff to augment its coverage. Like many newspapers in the same position, The Times still covers KTLA but discloses the relationship.

Despite the financial incentives to consolidate, even television executives concede that they harbor reservations about where further deregulation might lead.

“I’m not a fan of throwing all the regulations away and just letting people go at it,” said Andrew Fisher, president of Cox Television, whose duopolies are located in San Francisco; Orlando, Fla.; and Charlotte, N.C. “The unintended consequences of that can be serious.”

“I am concerned about all the restrictions going away,” Belo’s Sander added. “There are plenty of voices ... but it’s a legitimate debate. It’s one you almost have to look at market by market, situation by situation.”