WETA, Washington's public broadcasting outlet, has formed a profitmaking subsidiary to produce television commericials and meeting conducted via satellite, hoping to recoup a bit of the station's revenue that may be lost to federal budget cuts.
WETA formed WETAcom in January and hopes to market aggressively that services provided by the subsidiary, a tax-paying company. WETA is tax exempt.
"It won't offset anything, but it will help," said WETA President Ward Chamberline. "It will make a little dent in it, but it won't offset the loss" anticipated from budget cuts, he said.
One bill would cut federal revenues for public broadcasting in 1984 from $172 million to $100 million, which would mean a serious loss for local outlets such as WETA.
"We formed the subsidiary in January before we knew about the cuts," Chamberlin said. "But it was clear then that public funding was at a plateau."
WETA had been producing some commericials before the subsidiary was formed and made its facilities available for teleconferencing -- satellite-transmitted televised long-distance meetings to replace more costly live conferences.
Last fall WETA hired out its facilities to produce several political advertisements, including two for Ronald Reagan. When the public broadcasting company decided to expand its operations last fall, it decided that a profitmaking subsidiary was in order. The subsidiary will pass its profits on to the tax-exempt WETA.
Such an arrangement "blunts the very valid argument that some commercial people could make" that competition in a commercial arena by a tax-exempt organization is unfair, Chamberlin said. WETA's involvement in The Dial magazine has run into that very criticism from Washingtonian magazine publisher Phillip Merrill.
During the fiscal year ending June 30, 1980, WETA grossed $300,000 from commercial and other outside productions. "This year we will do about double that," Chamberlin said. In the year to come, WETAcom might gross closer to $1 million, which would mean $150,000 in new money for WETA if the subsidiary makes a 15 percent profit.
"The fact is, we have the best camera crews in town, and people want to use them," said Chamberlin. Many commercials for the Washington area are now produced in New York. "I don't think you have to go to New York to produce a first-class commercial," Chamberlin said. "I'd like that money to stay in Washington."
Besides camera crews, the company also has editing and other equipment available, he said. The equipment was not bought with federal funds, he said. a
So far, WETA has produced about one satellite conference a week, including one last week for the National Education Association that connected participants in 50 states. The subsidiary will rent facilities from the public broadcasting satellite system for those conferences.
We're going to be putting out brochures and marketing to increase our business," Chamberlin said. "The question is how much we can increase it" without interfering with WETA's normal activities, he said.
Other public broadcasting stations, including WNET in New York, KCET in Los Angeles and WGBH in Boston, also have turned to such money-making pursuits to help bolster financing, according to Chamberlin. "We weren't the first to start it."