Slicing The Pie Thin

Independent TV Advertising Shares Already Are Small; Now Channels 16 and 38 Are Cutting Each Other

There's been an explosion of viewing choices in recent years that is creating stiff competition and strained relations throughout the television industry.

Whether a station is affiliated with a major network or is operating as an independent, the lifeblood of both is programing. Advertising dollars are tied to ratings, ratings are dependent upon programing and while the major networks pay their affiliates to carry network programs, the affiliates must buy other programs from program syndicators just as independents buy all of their programing from syndicators.

In some markets like Chicago, New York, Los Angeles and Dallas, the independent stations either match or surpass network affiliates in ratings and billings.

But in Little Rock's $40 million television market where the network affiliates have been on the air for more than three decades, the new kids on the block -- independents -- have had trouble establishing themselves with both viewers and advertisers.

What's more, the oldest independent, KLRT, is locked in litigation with three-year-old KASN, with charges that KLRT tried to strip KASN of its Fox Network affiliation.

For KASN and KLRT, there's a vicious cycle. Both need more viewers to get better ratings to buy programs that will attract more viewers. And the high cost of program purchases has been cited as the single most important factor in the financial problems faced by many independents.

THE INDEPENDENT television industry across the country enjoyed booming growth from 1979 until 1989 when the numbers of stations went from 102 to 323. In its infancy the industry enjoyed prosperous times, and viewers seemed glad to have something other than network television to watch. But it didn't take long for all of that to change. By 1985, 25 independent stations were in Chapter 11 bankruptcy proceedings. Melvin Bell's station KRZB-TV in Hot Springs was one of the independents to become such a casualty. The reason?

"The demand for programing came so much faster than the supply, it drove programing prices to the roof," says Lawrence Laurent, VP of communications INTV Journal, a magazine aimed at the independent television broadcaster.

Laurent says programing prices have been coming down in the last few years, all but three of the troubled stations "straightened out" and another 16 independents went on the air during 1989.

Programing costs and ratings aren't the only problems that independents face. Historically, independent stations and cable companies wrangled over such questions as will cable systems carry independents, and where on the dial will they be carried if they are carried at all.

Lately, there have been new threats...