When the planned sale of WTVJ-NBC 6 to the Washington Post Co. (which also owns WPLG-ABC 10) fell through last year, it wasn't just some weird South Florida thing. The trade journal Broadcasting & Cable reportsthat, all over the country, "the tough economy has brought station sales to a screeching halt," The prices being offered for local TV stations has plummeted: B&C estimates that San Francisco's venerable KRON, which sold for $823 million just nine years ago, wouldn't bring $50 million in today's market. Not surprisingly, KRON's owner, Young Broadcasting, has pulled it off the market, even though the company is in bankruptcy and desperate for cash.
Sellers (and B&C) seem convinced that dropping prices are simply a function of the overall weakness of the U.S. economy, and that they'll rise when the country emerges from its recession. I wouldn't be so sure. Local TV stations are under the same pressure from the Internet that local newspapers are. Younger viewers are watching more and more of their network television on-line at site like Hulu, and the networks -- after initially resisting the idea -- are starting to like the idea, which essentially cuts out a troublesome and expensive middleman -- the local station.
Just this month, NBC faced a rebellion against its pet programming project when Ed Ansin, owner of the network's Boston affiliate (he also owns WSVN-Fox 7 in Miami), announced his station wouldn't carry Jay Leno's new prime-time show. NBC cracked the ship, threatening to unleash Mongol hordes of lawyers on Ansin, and he capitulated. But you don't think it cross Jeff Zucker's mind what a pleasant universe it would be if he never had to hear from another balky local general manager? The networks are going to speed the transition to the Internet, count on it, and the boom days for local stations may never return.