Right Place, Right Time

You won't hear Bill Bauman joining the outcry over the nasty tone of the political campaigns. He's general manager of WESH Orlando, Fla., which is raking in cash.

The Hearst-Argyle–owned NBC affiliate is in the middle of not just a presidential swing state but one where Democrat Bob Graham's pending retirement has spurred big spending to fill his Senate seat. As a bonus, trial lawyers and doctors are warring over a ballot initiative that would force physicians to tell patients more details about past accusations of malpractice.

Spending on political ads totaled $20 million in Orlando during the 2000 presidential race, and local stations predict they'll easily beat that number. "I see it at least 50% higher for the market," Bauman says. "We're going to have a huge campaign."

Bauman's good fortune is being repeated at stations across the country, at least those in the 17 states the Bush and Kerry presidential campaigns have targeted as "swing" states. The candidates, their political parties and surrogate "527" soft-money groups are concentrating hundreds of millions of ad dollars into those states, leaving station managers in other states disappointed at the dearth of ads. A number of hot local and state races, say analysts, plus ballot initiatives could help drive political spending to $1.6 billion this year, with around 85% of that going to TV stations.

"This has been an extraordinary year," says Fred Reynolds, president of Viacom's TV-stations group, which includes both CBS and UPN O&Os." In past years, he says, presidential campaigns have typically booked time a week or so ahead, preserving their flexibility. "In August, they started buying through October," he says. "I'd never seen that before."

The political surge is blocking other advertisers who want to get on the air. Want some weeknight spots in St. Louis this month? Forget it, only daytime and weekend inventory is available on the major stations, says Initiative Media Director of Local Broadcast Strategy Janice Finkel Greene. In Milwaukee, she says, only sports and late fringe are available for September. Other periods "are not available at any price" and are almost gone for October, too. Colorado Springs, Colo., is "completely sold out," owing to a U.S. Senate run by Coors Brewing heir Peter Coors. "Unlimited spending," she says.

Viacom appears to be the single biggest beneficiary of all that political spending. A study of spending patterns this year concludes that the Viacom stations will collect more political-ad dollars than any other broadcasters. Sanford Bernstein media analyst Tom Wolzien examined how large station groups' portfolios were distributed among 16 states where polls show the presidential race is close. That includes states like Ohio, Wisconsin, Colorado, Florida and Arizona. He also looked at which of those stations attracted the heaviest spending early in the political season.

Wolzien found Viacom's CBS stations blessed with favorable geography, such as Pennsylvania and Michigan, plus strong newscasts. Viacom was followed by Hearst- Argyle, NBC and ABC.

Cashing in requires more than being in the swing states, though; a broadcaster has to run the right kind of stations. The broadcaster with the strongest presence in swing states is Fox Television. With duopolies in key markets like Tampa, Fla.; Orlando; and Minneapolis, plus single stations in other important cities, the Fox station group potentially reaches 18 million viewers in swing states. That's 80% more than Viacom.

But newscasts on Fox O&Os are typically weak, so the company lags when politicians are seeking out voters. Fox's prime time audience also skews younger than most political ads typically target, since older crowds are more likely to vote.

Sinclair Broadcasting faces a similar problem. Wolzien pegs the stations' reach at 6.2 million swing-state viewers. That's three times as many as Belo Corp. But Sinclair stations have weak local newscasts and has been dropping news in some markets. Also, Sinclair's portfolio is heavy with young-skewing WB stations.

"It's a matter of being in the right part of the right state with the right newscast," Wolzien says. "Once you reach the newscast conclusion, the rest pretty much falls out."

Viacom's Reynolds enjoys riding the election-spending spree, but he's focusing on his stations' broader business. Says Reynolds, "It's been going all year long, but on Nov. 2, it's 'The End.'"