Hearst-Argyle's David Barrett: Good News, Good Guy

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Here's some good news about a man who helps good newscasts happen: At April 15's TVB Conference in New York, David Barrett, president and chief executive officer of Hearst-Argyle Broadcasting, will receive Broadcasting & Cable's annual Broadcaster of the Year Award.

The gregarious Chicago native gets the nod this year for his tireless efforts ensuring that Hearst-Argyle stations are among the strongest in the country in serving their communities, while watching the bottom line and expanding the company's business opportunities.

The newscasts of the Hearst-Argyle stations are usually No. 1 or 2 in their markets. And that's due not to sweeps stunts but to quality journalism that has been recognized with the country's most prestigious TV-journalism awards. This year alone, WESH Orlando, Fla., is being awarded both a George Foster Peabody Award and duPont-Columbia Award.

Last year, WISN Milwaukee received a Peabody and WCVB Boston a duPont-Columbia for local news efforts. Those awards are the gold standard for TV journalism. So is Hearst-Argyle's comprehensive campaign coverage.

The 55-year-old Barrett understands that better than most. Barrett believes in the values of good television and community service. He loves news, supports it, and sets high standards for everyone involved in every aspect of his operation.

When David Barrett joined Hearst Broadcasting to run WBAL (AM)/(FM) Baltimore nearly 20 years ago, one of his first missions was to grab the radio rights to the Baltimore Orioles baseball team from a rival station. It took him three years, but he finally persuaded then-station owner Edward Bennett Williams to give in.

It didn't hurt that the incumbent rights holder had defaulted on payments. Barrett lobbied hard to get corporate approval for the multiyear, multimillion-dollar rights deal. He knew the payoff would be handsome, even if the Birds, in rebuilding mode during the 1988 season, played only average ball.

But alas, they didn't play average ball. Not even close. They played like dodos, starting the season 0-21. Barrett was as embarrassed as the players.

"My name was all over it," says Barrett today, adding that the spring of '88 "is a time I will never forget."

During the streak, his boss, mentor, and then-vice president and general manager of Hearst Broadcasting, John Conomikes, called him after each loss to give him a proverbial slap on the back of the head. But Barrett lived to tell about it and, eventually, to laugh about it.

That says a lot about Barrett, Conomikes, and the culture at Hearst. Then as now, says Barrett, "We take risks and make decisions together on matters of great import in a collaborative way."

That's why Barrett is the third-ever Broadcaster of the Year, an award he'll receive at the Television Bureau of Advertising's annual conference April 15. Unlike the two other winners—Viacom's Dennis Swanson (who won the award when he was general manager of New York television station WNBC) and Tribune Co.'s Dennis FitzSimons—Barrett cut his teeth in radio, not television.

Like the best radio stations, though, Barrett knows the value of hyper-local broadcasting.

Hearst-Argyle is among a handful of group owners that keep an eye on the principle of serving the public interest without hurting the bottom line.

Five years ago, the company bought the nine Pulitzer Publishing Co. TV stations for $1.7 billion, a deal Barrett calls a "defining transaction" for the company.

In today's world of media consolidation, broadcasters have been forced to decide whether to grow and stay in the game or sell out and leave the business. The Pulitzer deal put the industry on notice that Hearst-Argyle intended to stay. "We said we were going to go for it. It was a risk for the company," but it helped Hearst leap into the big time of television ownership, Barrett says.

The business philosophy behind that decision to go for it has been engrained in Hearst executives for generations. At Hearst-Argyle, Barrett is both steward and benefactor of an approach that says well-reasoned risk is risk worth taking.

"Today, I'd say if we're doing things right, we're not hanging any individuals out there on their own to make high-risk decisions. That goes back to the culture of the company and how we like to operate. The story about the Orioles is fun to tell now, but, once the decision was made, I had the commitment of the company."

In January 2001, Barrett was named CEO of Hearst-Argyle Television, the No. 7 group TV operator by revenue, according to Bear Stearns. The 20-year Hearst veteran has been toiling in the industry since 1970.

HIS RADIO ROOTS

More than half of Barrett's career has been devoted to radio. In fact, he had never worked at a TV station before 1989, when Hearst handed him the reins of WBAL Baltimore, where he'd been running a TV-radio combination for five years. (Technically, Hearst Corp. alone owns the radio station, and Hearst-Argyle owns the TV station, but both are commonly run.)

His radio career started in Chicago, not far from the suburbs where Barrett was born and raised. As a senior at Loyola College, he "fell into" a radio job to help pay his college bills. (He also moved furniture and was a lifeguard.)

He and his siblings learned quickly to take care of themselves and each other. Their father died when Barrett was 20, forcing his mother to take a job. In addition to Barrett and an older brother, there were two younger sisters in the family, so anything he could do to earn a little extra money would be helpful.

Working for rock station WGLD(FM), he discovered, "I had a pretty good aptitude for sales," and, as advertisers soon learned, he was also good at collecting payments. (To know Barrett is to suspect as much: He's built like a lineman for the Chicago Bears.) That was important back then, since compensation was based on payments received.

After two years, Barrett was reading the classified ads in BROADCASTING magazine (as this publication was called then) and came across a sales-management position for a Montreal rock station.

It turned out to be a huge risk and big break. "I was ready for something different," Barrett recalls. Station owner Geoff Stirling was looking to the U.S. for someone with experience selling the album-oriented rock (AOR) format, which had first taken root in the states. So Barrett headed north, made a pitch, and got the job.

The big break came just four months later, when the general manager left and "they turned to me and said 'you look after it.'" At the tender age of 24, Barrett was general manager.

A year later, he married his long-time Chicago sweetheart, Elizabeth Balzer, and, after four years in Montreal, yearned to come back home. But the Bronfman family persuaded him to put off those plans. In addition to owning distiller Seagram and Major League Baseball's Montreal Expos, they owned a news, talk, and sports boomer in the Montreal market and wanted Barrett to run it, along with an FM beautiful-music station. "It was a spectacular time to be running those stations in that market," says Barrett. Montreal was gearing up to host the 1976 Olympics at the time.

JOINING HEARST

By 1980, though, the Canadian economy was heading south, and soon so was Barrett. The Bronfmans sold the radio stations, and Barrett returned to the U.S. to accept a job running Doubleday's KWY(FM) St. Louis. Not for long, though. A year later, he was back in Canada, recruited by media baron Ted Rogers to run a pair of Toronto radio outlets. "It was an unstable period in my life," recalls Barrett. "I wasn't letting any roots sink in."

After two years of running the Toronto combo, Barrett departed Canada for good, briefly rejoining Doubleday in Washington, D.C., to run WAVA(FM). Within months, however, he left after a falling out with his boss. It was not the best time for him professionally.

But what Barrett didn't know at the time was, his career was about take a turn for the better. John Conomikes, the general manager of Hearst Broadcasting, needed someone to run Hearst's two radio stations in Baltimore and offered Barrett the job.

But not right away. Conomikes liked Barrett and was quite impressed with his knowledge of radio. "But I was concerned that he was unemployed, so I interviewed 12 other people, who were employed. None of them were in the same league as David Barrett." But by the time he made a job offer, Barrett was mulling one to run a New York City radio station. However, Conomikes convinced him that his long-term future was better served at Hearst.

"It was probably the best decision I made in my life," Barrett says. Within a year, he was given responsibility for all seven radio properties in the Hearst portfolio. (That seems quaint in today's world, where the biggest player, Clear Channel, owns 1,200 stations.) Fifteen years into his career, Barrett was, in his own words, "totally a radio guy."

He had gained some exposure to television but no operating experience with the medium working for the Bronfmans' CTV station. As the head of Hearst's radio group, he increasingly realized that "95% of what we covered was related to TV."

And he was right. Hearst had largely concluded by then that its investments in the future would be in TV and cable and, in 1989, rewarded Barrett with responsibility for WBAL(TV), then Hearst's co-owned CBS affiliate in Baltimore.

Conomikes says he knew six months after Barrett joined Hearst that the young radio executive was destined to run a big TV group some day—Hearst's or someone else's. "It just became so obvious that this guy had all the tools to be a big player. He's a special guy, and the TV industry is lucky to have him."

Soon after, fate intervened with the death of the Mickey Hooten, deputy general manager of Hearst Broadcasting and Conomikes' No. 2 executive. Barrett's work at WBAL and at the radio stations had made an impression on Conomikes. He was so impressed that he tapped Barrett as his new deputy, to help him run the entire Hearst Broadcasting group: seven radio properties and six television stations, including flagship WTAE Pittsburgh and WCVB Boston, which Hearst had acquired in 1986 for $450 million, at the time a record price for a single TV station.

LESSONS LEARNED

That's when Barrett's real education and immersion into the TV business began, with Conomikes as his mentor. For the next eight years, the pair worked closely, dramatically expanding Hearst's TV holdings.

They also branched out into new businesses, including a production and syndication venture with NBC and Gannett and a Web-site venture with Internet Broadcasting System.

"Being John Conomikes' understudy for eight years," says Barrett, "was the best learning opportunity anybody in the TV business could possibly have."

Conomikes retired as chairman of Hearst-Argyle Television in 1999, but he's one of the most active retirees in the business. He's still on the Hearst-Argyle board and is very involved in the affairs of Hearst Corp. "In some ways," says Barrett, "John never retired. He is still the guy I trust and most rely in the business."

Conomikes is also on the boards of Lifetime, A&E, and ESPN (Hearst has minority stakes in each). "He's the youngest 72-year-old you'll ever meet," Barrett marvels. "As a mentor, he was the single most important guy teaching me about business and the business of television."

In 1997, Hearst spun off its broadcasting group into a so-called "reverse merger" with

Argyle Television, a television group with about the same number of stations as Hearst but in smaller markets. At the time, the Hearst properties had three times the revenues of Argyle. Together, they formed the publicly traded Hearst-Argyle Television, with combined pro forma revenues of approximately $385 million.

When the merger was completed, Barrett was named chief operating officer of the company, and Conomikes and Bob Marbut, who had run Argyle TV, became co-CEOs. The merger gave Hearst-Argyle the public currency it needed to expand, says Barrett. It did so quickly, targeting the Pulitzer stations.

With the stock transaction, Hearst Corp. remained the principal owner, but its stake was reduced from more than 80% to 66%, while Pulitzer family members were issued 37 million new shares of Hearst-Argyle stock, giving them a combined stake in the company of between 7% and 8%.

At around the same time, Hearst-Argyle bought KCRA Sacramento, Calif. But it was the Pulitzer deal that signaled Hearst- Argyle's long-term intentions. It doubled the size of the company, to 26 stations and nearly doubled the size of its annual revenue base to $710 million.

But in days of megamedia giants, is that big enough to stay independent? "I think we can, but time will tell," says Barrett. "Five years from now, we won't be the same company with the same number of stations. We're still building it. If I ever say we've finished, it's time for me to go. It's a never-ending process."

"STRAIGHT, DIRECT"

"David is a unique manager," says Tony Vinciquerra, president of the Fox Networks Group, who worked with Barrett for five years between 1997 and 2002, when he was COO. "He's very honest, very straight, and very direct. No one ever wonders where they stand with him because he's very clear about it."

Vinciquerra recalls, "We were buying companies and integrating them, and we had lots of struggles and lots of issues. But he was always right there for support and to discuss issues and come up with solutions."

Barrett has only lost his temper once that Vinciquerra can remember. That was when a certain small and relatively new broadcast network (that shall remain nameless) pulled an affiliation from a Hearst-Argyle station after promising to renew it.

FUTURE CHALLENGES

Even-handed and level-headed as he is, Barrett still jokes that he hopes he's smart enough to figure out the business someday.

Hearst-Argyle is kicking the tires of new technology. Under Barrett, it has branched out with related ventures. It's a part owner of Internet Broadcasting System, which builds Web sites, sells advertising, and provides content for other stations. It also has a small stake in NBC Enterprises and gets dibs on new first-run offerings from the company. Both ventures are profitable, but have yet to pay off for Hearst.

Like many broadcast executives, Barrett believes it's critical that the industry figure out the best way to exploit the digital spectrum; he thinks NBC has been the most aggressive trying to come up with workable ventures that will benefit the network and its affiliates. But Barrett's not expecting much soon. Of course, none of it will amount to a hill of beans unless cable agrees to carry the entire spectrum. That, Barrett suggests, just may take governmental intervention.

"The level of competition won't slow," he says, "and figuring out how to meet the needs of our customers—both advertisers and viewers—is a continual process."

Barrett has thrown out some ideas publicly about how to do that, but they haven't always been well received. Given the longer workday and other diversions fracturing the viewing audience, he wonders if at least one network ought not call it a day at 10 p.m. rather than 11, to stem the erosion in late-night news viewing. Which network? Barrett says the worst performer in prime time ought to consider it. That, of course, would be ABC.

"Local news is something that is terribly important to our viewers, but there are days where we put it on at 11 p.m. and it's not in step with the way people use television and the way people live their lives. It's on too late."

Barrett thinks job one is serving viewers. If that happens, he says, the business imperatives should take care of themselves. "We define success in television as how effective we are in local communities with our news services and how engaged we are with the community. Part of that is being very engaged on the local sales front and being good partners with our advertisers."

Since his days in radio, he has learned how to do it like few others. And, in time, the Orioles got better, too.

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