By Hank Price
Senior Fellow, Broadcast and News Strategy

Though advertising has now recovered, station owners find they can no longer avoid confronting the underlying problems with the very nature of local television news — the past decade has brought too many new local newscasts, too many new competitors such as cable and Internet, and too much audience fragmentation. Local news may still define local television, but for many stations it will never again be the "cash cow" of the 1990's. Indeed for some it will no longer even be profitable.

In the coming years we will see fundamental changes in the way local news is presented, the variety of television newscasts available, even the complete elimination of local news by some stations. In the end, most communities will end up with one or two "mega" news stations while other outlets will offer entertainment or specialized programming. In other words, television is about to undergo exactly the same kind of change newspapers experienced during the 1950's.

Like newspapers, the result will produce big winners and equally big losers. There will also be a new kind of middle ground with smaller outlets and fresh voices, not unlike the suburban and alternate/free newspapers that now serve so many communities. These diverse views will help balance the scope and attitudes of local coverage. Interestingly, when the transition is complete, the public may be better served.

In order to comprehend why all this is happening, we need to understand something about the history of TV local news and why it exists in it's present form.

Thirty years ago most stations saw news as a mere public-service obligation, not a profit center. Newscasts at 6:00 and 11:00 p.m. were simple, straightforward affairs with sparse film and graphics. Broadcasting live from a news event was rare, expensive and reserved for major stories. Authoritative anchors, almost always male, read headlines and other snippets of information to fill the 22-minute "news hole." Many news departments were so small it was not unusual for one person to serve as anchor, news director and producer.

Of course, even in those days stations wanted high ratings for their newscasts since ratings have always been the Holy Grail of television. But the real interest was not in news. Stations cared mostly about prime time where big audiences created strong profits.

The 1970's brought sophistication to local news. Less costly technology and sociological changes boosted television's role in viewers' lives. Huge cultural shifts in the previous decade had created a new generation of Americans not content with simple and slow moving news presentations. The assassination of John Kennedy, the Vietnam War, the arrival of astronauts on the Moon all changed viewer expectations. Anything short of immediate gratification was no longer acceptable.

Television station owners and managers were quick to spot the profit potential in providing a sophisticated product that satisfied this new desire for instant information. Local news became profitable — very profitable. So profitable that the competition for first place in local news became the hallmark of a station's prestige and worth.

To fully understand those days, one must remember that local television had no real competition during the 1970's. Few viewers had cable and almost no one owned a VCR. Satellites, personal computers and the Internet were all still in the future. Local TV was King with a capital K.

The scramble for ratings led to a formulization of newscasts that continues to this day. News, weather and sports in that order. Attractive co-anchors, live field reports, expensive animations, short stories with lots of video. The list is still unchanged. Though homogenized, with little variation from station to station, news ratings and profits still grew. Public hunger for information seemed insatiable with plenty of viewers to go around.

Stations also began to expand the length of newscasts, adding mornings and other time periods. With expansion came even more profits. As one who grew up in television during that era, I remember the common saying at stations: "We've got a printing press in the basement. It prints money all day long."

Those TV printing presses hummed along through the 1980's, temporarily stopped during the Gulf War, then roared back through the 1990's.

The 1990's will be remembered as the decade when television news became truly over-expanded. New competitors such as FOX, WB and UPN showed up, most with some local news presence. The success of CNN during the Gulf War caused NBC and FOX to enter the cable news business and in larger markets 24-hour local cable news operations joined the array of news options. Then the Internet and other new technologies became a factor. All competed for viewer attention and time.

Local stations responded by continuing to expand news, filling even odd time periods such as 5:00 a.m. Consumers no longer had to wait until 6:00 and 11:00 p.m. for the latest information. By the end of the 1990's audiences were fragmented with too many choices. Individual newscasts began to experience a new phenomenon — shrinking viewership.

In spite of assault from new competitors on all sides, and its own over abundance of newscasts, local television news remained viewers' first choice. Advertisers, whose loyalty to programs is always based on Nielsen ratings, recognized the enduring value of local news, continuing to increase spending right up to the current recession.

Before recession reared, there was plenty of money to bring profits to almost any station producing a local newscast. 2001 is the first year in which the entire over-expanded news media has had to face a downturn.

Suddenly, with not enough money to go around, weaker competitors faced a harsh reality. Perhaps there is now too much local news in America, more than the economy can support. For the first time, some broadcasting group owners were forced to ask: "Should we be in the local news business?" For marginal operators with weak stations, the answer is "No!"

Shock waves rumbled through the industry a few weeks ago when KDNL-TV, the ABC affiliate in St. Louis, announced it was laying off all news employees and withdrawing from local news. If a network affiliate can go out of the news business in St. Louis, the nation's 22nd largest market, it can happen anywhere.

KDNL is important not just because it cancelled local news, but because it represents the model for other stations which will withdraw — a marginal competitor never able to establish its self as a leader. There are television stations like KDNL all across America.

The irony is that KDNL, relieved of the expense of producing newscasts, will undoubtedly now become more profitable. At the same time, other newscasts in St. Louis will attract some of KDNL's lost news viewers, adding to those station's profits. Investors win, but an "informed citizenry" may not as some people will stop watching news altogether.

Even as some stations drop out of the local news business, those who remain will continue to face viewer fragmentation and lifestyle changes and they will still need to find inventive ways to compete. Instead of all local newscasts looking and sounding alike, stations must find ways to offer fresh and unique services. This will be a difficult process, but it will happen. Never underestimate the power of creativity when profits are at stake.

One answer is to combine the forces of local television news with those of local newspapers. Although long and bitter rivals, television stations and newspapers offer each other their single best hope for future growth. Television offers immediacy, production sophistication and a high level of competition. Newspapers are larger organizations with greater databases, more specialized reporting staffs and an overall breadth and depth not usually found in local stations. Combined, television and newspaper have the potential to raise the level of service to viewers and readers alike. Media General, an owner of both newspapers and television stations, is already experimenting with this concept in Tampa. So is Tribune in Chicago.

Larger local news organizations are also essential for TV to take advantage of the coming digital revolution. A digital station will be capable, for instance, of broadcasting multiple newscasts at the same time. Those newscasts could be tailored to individual cities, or even neighborhoods, in a station's viewing area. Such a scenario is only possible if a station joins forces with a newspaper.

Other local television stations may find it advantageous to combine with each other. This is happening in Jacksonville, Florida where the NBC affiliate and the ABC affiliate are both owned by Gannett and share one newsroom.

Finally, broadcasters must remember that all this is happening in a world where viewers have more and more choices. As technology costs continue to fall, it will be economic for suburban and inner city newspapers to either join forces with a station — or to offer TV news of their own. A new system called Parkervision already makes it possible to replace almost all television production equipment — and operators — with one sophisticated computer. As production costs continue to drop, more and more micro-newscasts will become available. Station must decide if they will fill this arena or leave it to others.

All of these changes would have happened without the wrenching events of September 11th. What that tragedy altered is the speed of the change. Local television can simply no longer wait for the future. Hold onto your seat. The future is now.

 

			Hank Price Senior Fellow, Broadcast News Strategy Media Management Center General Manager, WXII-TV Winston-Salem, N.C. Mr. Price's bio