Post-Newsweek's Frank Optimistic About Station Business

Alan Frank has been CEO of the station group owned by the Washington Post Co. since the business barely faced a question about a robust future. Assuming the role 11 years ago, he took over before disruption from DVRs or Web video seemed troubling and when the 6 and 11 p.m. newscasts loomed larger in local communities.

Yet, Frank's optimism about the local-station business was on display last week at a Post Co. shareholders' meeting. His measured, understated style may have been more convincing than a stentorian delivery from another executive, which might have sounded more like a defense.

Frank offered a list of factors that has him bullish, including the so-called retransmission consent payments stations are receiving, which was hardly on the radar just a few years ago. In 2007, Frank said cable/satellite/telco providers were paying the Post-Newsweek Stations 10 cents per subscriber. That's up  to 50 cents this year and on its way to a $1.

The Post-Newsweek stations operate in six markets (four in the top 20) with a total of 8.6 million homes, so that can bring a considerable jump. Of course, some of that money will be paid forward to the networks that provide programming.



As many station groups have had contentious negotiations with operators leading to programming being yanked off the air, Frank said Post-Newsweek has never reached that point. That isn't surprising considering his apparently conciliatory approach.

(One of the more interesting, yet least important questions, Frank did not address last week is why "Newsweek" continues as part of the station group's name considering the Post Co. has sold the magazine.)

Other positives Frank offered include political advertising, where despite audience fragmentation and campaigns experimenting with social media, local stations continue as the preferred medium. At Post-Newsweek in particular, the prognosis looks strong with stations in the swing-state, large Florida markets of Miami, Orlando and Jacksonville.

There's also the chance to grab some revenues from the increasing fascination with iPads and smartphones. Post-Newsweek is one of a slew of station groups in a joint venture that's making a major push into live streaming, scheduled to launch either late this year or early next. The initiative will have programming available on-the-go in a minimum of 40% of the country, with a minimum of two free channels in each market. Frank said the rollout should yield insight into whether there is a viable business model there.

Frank, who joined Post-Newsweek in 1979 and rose to general manager of its Detroit station before becoming CEO, indicated he views new technology as a potential positive for the old tube. Younger viewers, he said, enjoy communicating with each other about shos while watching, so tweeting and Facebooking are contributing to more viewing of live TV. Post-Newsweek's two largest stations are NBC affiliates (in Houston and Detroit), where programming such as "The Voice" and Olympics should play into the live viewing-instant tweeting dynamic.

At Post-Newsweek, after revenues plummeted during the 2009 recession, last year brought a 25% jump. Through the first six months of this year, without significant political money and an Olympics, there has been a slight bump. That likely would have been higher if the Japanese tsunami hadn't impacted the auto industry so much, so the core business is healthy, Frank said.

Frank has put in motion a series of events recently that may lower costs, while also helping grow the top line. Concerned his stations' on-air appearance was distracting from the high-paid anchors during newscasts, he set up a centralized design hub at the Miami station to clean things up.

"I was concerned about the look at all our stations and how sometimes we were getting crowded," Frank said.

While not launched to trim costs, the design center has effectively allowed Post-Newsweek to drop the art departments at its stations and save $1.5 million over five years.

This year, came a traffic hub in Jacksonville -- where the company has an independent station -- that now controls the slotting of advertising, programming and promos at all the stations. That's estimated to yield $2 million in savings over five years.

Perhaps Frank's biggest challenge - save the rocky economy - was looking for a way to reinvigorate a struggling KPRC in Houston. Showing a slice of humor, he said: "You all know from (Presidential candidate and Texas governor) Rick Perry that Texas is a state that's doing better than most in (these) economic times, and so there's a lot of money to be made, and particularly in Houston, and we were not performing as we might."

Newscasts had lost momentum, but a company-wide focus has returned them all to second place.

While there are some structural reasons why companies want to rid themselves of their local station groups (notably McGraw-Hill, which has a profile similar to Post-Newsweek), the road ahead looks smooth listening to Frank He may be more persuasive than others, however.

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