Scripps Stations Will Never Forget 2004

Scripps' broadcast stations had it both good and bad last year. The 11th-largest broadcast group, according to B&C's 2005 survey, Scripps enjoyed the political advertising windfall of having stations in Ohio, a battleground state in last year's presidential race.

It also had that advantage in Florida. But there, Scripps also had the challenge of owning two stations in a state battered by hurricanes last season.

The Sunshine State outlets performed heroically, but not without damage to the stations and equipment. Hurricane Frances zeroed in on WPTV West Palm Beach, ripping off parts of its roof and flooding editing bays and the entire second floor—a $2 million hit. WFTS Tampa was luckier, but a construction crew was on standby to perform emergency repairs.

Scripps owns 15 stations, including outlets in Detroit, Phoenix, Kansas City, Mo., and Baltimore. Its 10 traditional stations—six ABC affiliates, three NBCs and one independent—cover about 10% of the country. Five others are home-shopping channels.

Scripps has been around awhile. Its familiar lighthouse logo, a carryover from the upper-left corner of its newspapers, is displayed on the left corner of the building that houses WEWS Cleveland, which signed on in 1947 as the state's first TV station. One of the group's strengths is its regional pairings: WEWS and WCPO in Scripps' corporate home in Cincinnati, and Florida's WPTV and WFTS.

Those four stations were an engine in 2004, when, buoyed by heavy political spending, the group's TV-station revenue soared 12.5% to $342 million versus 2003. (Of course, the stations still contribute less to the corporate bottom line than a single cable network. Scripps' top cable network HGTV recorded $377 million last year, up 26% over the year before.)

Still, the station groups were flush last year. Political monies poured in: $41.5 million for the year, compared with $31.5 million in 2000, the previous presidential-election year. In the fourth quarter alone, Scripps’ stations nabbed $21 million in political-ad spending.

The irony of last year's riches is not lost on anyone at Scrips, including E.W. Scripps CEO Ken Lowe. "We benefited from having market-leading stations in the key swing states," he told media analysts recently. "Of course, it goes without saying, but let me say it anyway: The success we had with political in 2004 will make for tough comparisons this year."

Also crimping the coffers is that 2005 is a non-Olympics year for Scripps' three NBC stations. "They call it a Chinese curse," says Bill Peterson, senior VP of television and the head of the station group.

When political monies are factored in, ad revenue is expected to dip 2%-4% this year. When political dollars are removed, though, that picture improves to low-single-digit gains.

Facing an odd-numbered year, local broadcasters need to get creative. In some instances, the stations band together on sales efforts. WEWS and WCPO co-produced and sold vignettes on the Ohio Centennial celebration. In Florida, WFTS and WPTV sometimes strike deals, as do the Ohio stations and WXYZ Detroit. The efforts are paying off. Peterson says non-traditional and new business bring in about $20 million a year.

Among Scripps' stations, ABC's prime time success is particularly well timed. With six affiliates, Scripps has one of the network's largest contingents. When Desperate Housewives and Lost burst onto the scene last fall, ABC stations received much-needed salvation. The shows are helping reverse the network's downward spiral. In recent seasons, ABC languished in fourth place in prime and hadn't had a big hit since Who Wants To Be a Millionaire (which the network famously played to death.)

What a difference a hit or two makes. Now the ABC stations are one of Scripps’ strengths, says Fulcrum Capital Group media analyst Ed Antorino: “ABC is on a roll right now, and it is the bulk of the group’s revenue and cash flow.” Now it’s the NBC affiliates that could become the problem children.

"When the network starts to soften, it is important that you have other strengths," says Peterson. Strong local news and top syndicated fare, he says, give a station attributes to sell even in lean years.

Peterson doesn't consider the Scripps broadcast model all that mysterious. "We're not a real fancy broadcast group," he says. "We have four priorities: to increase ratings, maximize revenue, serve our communities and support the Scripps cable networks."