Texas Tough - Broadcasting & Cable

Texas Tough

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Local Flavor

Oil is still part of Houston's identity, but the city's economy is now
driven by a thriving service sector. Since the bust of the 1980s, Houston has
bounced back. And the nation's 11th-largest TV market boasts a competitive
media landscape.

Belo's KHOU emerged as the market's news leader in May, though not by
much. The CBS affiliate took the top spot at 5 p.m. and 6 p.m., finishing a
close second at 10 p.m. ABC-owned KTRK won the 10 p.m. slot and claimed the
most viewers for the total day. "It's all about consistency," says General
Manager Henry Florsheim. "Our lead anchor, Dave Ward, has been at the station
for over 35 years, and we've been No. 1 most of that time."

KPRC, owned by Post-Newsweek, finished third at 10 p.m., as it has for
much of the last decade. Yet it's a tight race. The three stations are
separated by less than 3 household share points.

The newscast of Fox O&O KRIV easily outdraws Tribune's WB affiliate
KHWB at 9 p.m. Fox also owns UPN affiliate KTXH.

KTRK fills its early fringe and prime access time with news programs.
Plus, it runs the market's longest continuous news block from 4 p.m. to 7
p.m.

On the Spanish-language front, Houston's large Hispanic population
supports five full-time stations. Univision's KXLN dominates in both audience
share and ad revenue. BIA estimates that Spanish-language stations extract
about 16% of the market's TV revenue, while recording about 18% of the
viewing.

Flat terrain renders cable unnecessary for many residents. Just over
half of households have it, one of the lowest penetration rates in the country.
Time Warner and Belo Corp. recently pulled the plug on News 24, their jointly
operated cable news channel. Jack Sander, Belo's president of media operations,
cited the presence of "well-established competitors that made it difficult for
a new brand to gain a foothold."

After several off years, Houston is poised to generate about 30,000 new
jobs in 2004. That's testament to the market's economic evolution, Florsheim
says. "We are a diverse market ethnically, and we have a far more diversified
economy now. This is a dynamic growth market." Jim Kollaer, president of the
Great Houston Partnership, agrees: "The larger forces shaping the Houston
economy are aligned in our favor."

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