The Local Station Nightmare

It is a call that every local GM would dread to get and it might be happening sooner than you think.

Former News Executive turned consultant Steve Schwaid plays out a scenario that could become reality much sooner then you expected.

Here's Schwaid's take:

The GM woke up from a nightmare. In a cold sweat, all he/she could think about was something from the nightmare, when the network affiliate relations representative said on the phone: “We’ve enjoyed our relationship for the past 50 years, but when our contract expires we won’t be renewing it.”

The conversation continued: “Who will be getting the affiliation in our market? We carry your football games and some of the market’s number one shows. We’ve been loyal to you for decades.”  The network rep responded, “Yep, and we both benefited. Thanks, it’s been fun. This is a business decision. We no longer need affiliates. No one’s getting our shows but us.”

This nightmare could come true sooner than you think.

You were given a peek at the future this week when CBS announced it would be continuing the Star Trek franchise in 2017.  But wait… only the premiere will actually air on CBS.  The rest of the episodes will be available ONLY on the CBS subscription streaming service. Look ma, no affiliates.

CBS is creating entertainment programing that they will not put on TV. And they’re not selling it to Amazon or Netflix. They’re expanding their OTT platform – a platform like HBO and Showtime that uses apps where users can buy the digital stream and bypass cable.

Think about it.  Given the technology today, why DOES a network need an affiliate? Look at some of the top cable shows; they do very well without affils. Then take a well branded network like NBC, Fox, CBS or ABC and ask yourselves why do they need you when they have ways to go directly to viewers?

You might say you’re safe because the nets want the lucrative reverse comp you’re paying them. Their response could be, “We’ll get that directly from the cable guys when we feed them our program. And not dealing with affiliates will save money, time and frustration.”

You can’t say you’re surprised. It’s been pretty clear this is the way the industry is heading. But the future is a lot closer than you may have realized.

So let’s imagine your station gets “THAT” call today from the network. How will you survive? WILL you survive? If it happened to all of the station affiliates in your market, how would you all survive?

We’ve seen this happen already to individual stations in Jacksonville and in Charlotte. The station management was proactive.

Are you getting ready for that call? You should. Maybe you’ll sleep without nightmares.

H/T Steve Schwaid