“The search for gold is quintessentially American,” Andy Dale was telling me the other day, sounding a bit like a college professor lecturing students about American corporate culture. In this case, however, Dale was making a very specific point about the Outdoor Channel, the growing cable network he serves as president and chief executive.
Outdoor traces its roots back to an itinerant marketer of gold-prospecting tips and equipment named George “the Old Buzzard” Massie. A burly, gregarious Kentuckian with a Theodore Roosevelt mustache, Massie was known for his inexhaustible drive to sell memberships in his Gold Prospectors Assn. of America, a club that today claims 32,000 dues-paying members.
According to family lore passed on by his son, Perry, who now heads Global Outdoors Inc., the parent company of the club and the cable channel, the Old Buzzard, who died in 1993, moved into broadcasting by videotaping short programs recounting his own prospecting exploits and pitching memberships. He would buy time on small, generally rural TV stations to air them on weekend mornings, at which point the Massie family discovered that there was a natural crossover audience between gold prospecting hopefuls and the hunters and fishermen whose own niche programs aired in the same scheduling ghetto.
They kept that lesson in mind as they shifted George’s programs from over-the-air stations to a satellite transponder serving the old C-band dishes -- those huge metal receivers that once sprouted like big metal sunflowers in rural backyards but are now almost extinct. The cost and capacity of a full-time transponder forced upon them the realization that they needed more than prospecting come-ons, so they broadened their offerings into a wide range of hunting and fishing shows.
“The channel was still mostly a tool to market the gold prospecting club,” Perry Massie says. “But there was a lot of other programming available -- every mayor in Alabama wanted to do his own fishing show, and they couldn’t find anyone to carry it.”
After they learned that small cable operators were picking up their satellite feed for retransmission, the Massie family moved off C-band and into cable programming in earnest. They mortgaged most of their personal assets to make the transition and endured a few scary years of near-bankruptcy, but in time the company returned to the black.
The Outdoor Channel is now the tail that wags the retriever, so to speak: As of last year it accounted for 80% of the company’s revenue, with the gold club and a unit that operates camping and prospecting trips to Global’s prospecting claims in Alaska and elsewhere providing the rest. The company’s shares, of which about 90% are controlled by George’s widow, Wilma, and her sons, Perry and Tom, are listed on the Nasdaq bulletin board.
Over the last few years Outdoor has been showing up on an increasing number of major cable systems across the country. It is now carried by both satellite TV services -- EchoStar Communications Corp.'s Dish Network and Hughes Electronics Corp.'s DirecTV -- and with nearly 23 million subscribers, it may be on the verge of reaching the critical mass that attracts national advertisers. For its audience, which is a gratifying 78% male -- the male TV demographic being as elusive a game animal as the bongo of East Africa -- that means a step up in commercials from the camouflage outfitters and outdoor grills it has now to, say, pickup truck manufacturers. The company’s ad executives say they’re beginning to hear encouraging noises from the latter.
Outdoor is still the kind of low-cost operation one would expect from its pedigree. Although its Temecula headquarters houses state-of-the-art editing and studio equipment, it acquires most of its programming by bartering ad time with independent producers of such shows as “Babe Winkelman’s Good Fishing.” The closest thing it has to a mainstream star may be the 1970s rocker Ted Nugent (“Cat Scratch Fever”), a lifelong bowhunter who produces the weekly “Spirit of the Wild,” a graphic paean to the elemental virtues of stalking and killing one’s own meat. (“My idea of fast food is a running whitetail deer!”)
But like the hosts of Outdoor Channel hunting programs who shadow their quarry from wooded stands, the Massies represent a small, if not vanishing, breed in cable programming: the rugged independent. They’re trying to build a viable franchise without being part of a well-heeled and well-connected parent in broadcasting, like Viacom Inc. or Walt Disney Co., or in cable distribution, like Comcast Corp. or AOL Time Warner Inc. By most measures they’re in an unequal fight.
“They’re doing what a lot of the independent networks are trying to do,” says Derek Baine, a senior analyst at the market research firm of Paul Kagan Associates. “They’re using home-grown programming and low costs to build slowly. But it’s very hard in this environment to take a stand like that.”
As it happens, the issue of how the little guy can compete in cable programming against increasingly powerful competitors is what first brought the Outdoor Channel to my attention. A few weeks back I wrote a column ridiculing Michael K. Powell, chairman of the Federal Communications Commission, for contending that the existence of a “bass fishing channel” proved that the big media conglomerates whose interests he seems determined to promote in Washington could never actually wipe out the diversity of programming on cable TV. My own observation was that this was a fatuous argument, in part because there was no such thing as a bass fishing channel.
My column promptly drew a peeved e-mail from Dale, who wrote: “There is a bass fishing channel, and it’s called the Outdoor Channel.”
But Dale was selling himself short. His channel is much more than merely a bass fishing channel; more to the point, his company’s experience underscores the real threat to programming diversity posed by the consolidation of television broadcasting and distribution in fewer, plumper, hands.
For one thing, the number of people who make judgments about who gets space on cable systems is shrinking fast, as more and more regional systems come under the control of cable megalopolies such as Comcast and AOL Time Warner. The Outdoor Channel owed much of its early growth to its ability to win space on small regional cable systems, then exploiting its success on those as a selling point to appeal to larger operators.
“We moved up the food chain,” Dale says. But now “there are fewer people to sell to. If your programming doesn’t appeal to seven or eight decision makers out there, you’re in trouble. It’s gotten to the point where you can fit them all on one elevator.”
Meanwhile, the ability of well-funded new channels to pay cable systems millions of dollars for carriage, particularly on channels included in high-viewership “basic cable” subscriber packages, squeezes out bootstrapping entrepreneurs lacking that kind of money. Comcast’s Outdoor Life Network, whose hairy-chested adventure lineup bears the closest resemblance on the dial to the Outdoor Channel’s, paid large systems upfront fees of $2 to $5 per subscriber to secure carriage, Baine says. This gave it a huge leg up in reaching the magic 40-million-subscriber mark that represents critical mass in the cable market. (OLN now has 52 million subscribers and expects to hit 60 million by year-end, according to its CEO, Roger Williams.) By contrast, the Outdoor Channel charges operators a monthly fee, although it’s a modest few cents per subscriber and is frequently discounted even further.
The barriers to the cable dial are even more daunting when one considers the leverage enjoyed by new channels affiliated with major broadcasting companies. Disney, Viacom or News Corp.'s Fox unit can encourage cable operators to carry, respectively, SoapNet, TV Land or FX by offering them package deals that include the local over-the-air ABC, CBS or Fox stations the same conglomerates own, and which by FCC mandate must be carried by the local system. It may look as though there are 500 channels (and nothing on), but prime space on the cable grid is a finite commodity, and there’s less room than ever for independent entrepreneurs.
It’s a complex world out there, isn’t it, Mr. Powell?
Despite these challenges, the Outdoor Channel has been growing. Massie and Dale believe their recent success is the result of sticking to their niche. They contrast Outdoor’s programming with that of Outdoor Life Network: Although both offer hunting, fishing and rodeo shows, the latter plays more to sports and adventure fans with programs such as an upcoming tag-along with a team climbing Mt. Everest and several live hours of daily coverage scheduled for this summer’s Tour de France. (The Outdoor Channel’s idea of the right team sports coverage for its audience was its daily airing in March of news from the Iditarod dogsled race.)
Whether this market is big enough to drive further growth and a national footprint may not be clear for another couple of years. In the meantime, there remains the possibility that one of the media conglomerates, detecting the glint of gold in Outdoor’s field and stream audience, might launch a competitive channel of its own. A couple of years ago there were hints that Disney was contemplating an “ESPN Outdoors” spinoff of its dominating sports network, which might have shouldered the Outdoor Channel off a lot of cable systems.
“We really upped our efforts to entrench ourselves by signing long-term contracts” for carriage, Perry Massie says. But he believes his best defense against any such assault will be his channel’s unique empathy with its viewers. “I don’t think any of the big media companies could better understand our viewers than we can,” he says.
Golden State appears every Monday and Thursday. Michael Hiltzik can be reached at firstname.lastname@example.org.