While most journalists may tremble when the controversial Australian media baron Rupert Murdoch takes over a newspaper, it's now business as usual at Washington's WTTG-TV, one of six Metromedia stations being acquired by Murdoch.
That business has been pretty brisk the past few years. WTTG has been at the forefront of a group of independent stations that have carved out a niche in the broadcasting industry by managing to compete with high-powered network affiliates.
In the last round of Arbitron ratings, the station had the highest share of any independent in the country, according to Katz American Television, WTTG's New York representative and research group. It was the only station in the country to beat any network affiliate in its market. "Few independents even come close to WTTG," the agency said.
For example, in the February ratings, WTTG-Channel 5 beat out WRC-Channel 4, an NBC-owned station, for the percentage of televisions tuned in between 9 a.m. and midnight. It also tied with WJLA-Channel 7, an ABC affiliate, for a 20 percent share of the Washington market and was 2 share points behind WDVM-Channel 9, a CBS affiliate.
"You can't take it away from them, they do an excellent job and can claim success," said one top executive at Channel 9, a CBS affiliate in Washington. The executive said that although Channel 5 is "not regarded as competition" by the network affiliates, "they do very well. In fact, once in a while they beat channel 4 or 7 in their early newscasts. . . . They just run a very, very good operation."
"We are a good example of success in the growth of independent television," said Bob O'Connor, Channel 5 vice president and general manager. That success, he said, has been born of "our ability to acquire or develop quality programming."
Programming strategy and staying lean have been the keys to the station's success in raking in advertising revenue, said Andrew Schwartzman, director of the Media Access Project, a consumer interest group.
"In terms of their local production staff, it's a financially tight, low-budget type of place," he said. "Their programming is pure counterprogramming -- that's former owner John Kluge's signature."
Metromedia found a way to compete with the networks: Letting them fight over shows while Channel 5 aired programming that contrasted with what the networks were airing.
"They show soap operas when the news is on, they have news when the movies are on, comedies when the soaps are on," Schwartzman said. "John Kluge understood if networks had an 80 percent share in a major market, 20 percent of viewers wanted to watch something else."
In recent months, the station's image has been tarnished by reports of WTTG's close relationship with Gray & Co., a Washington lobbying firm. In March, The Washington Post reported that the station aired Gray & Co. electronic press releases, particularly one show done from abroad by Gray Vice President Meryl Comer, a former WTTG reporter, on behalf of the kingdom of Morocco and a Japanese public relations firm retained by the Japanese government. Federally mandated labeling of the material as political advocacy or propaganda was absent when the newscasts aired.
In addition, a discrimination suit against the station filed by Gloria Gibson, the station's first black co-anchor, is pending. Gibson left the station in 1983, complaining that management "cut back" her duties drastically.
But WTTG has been financially successful, and the question now is what Murdoch's ownership will mean for it. Many at the station believe that Murdoch's money and his co-ownership, together with Denver oilman Marvin Davis, of Twentieth Century-Fox Film Corp. will lead to more original programming and a chance to boost the station into new prominence as part of a fourth national television network.
"I know WTTG is very excited about the fact there is combination of a movie studio and newspaper involvement," said former vice president and general manager Kevin O'Brien, who left recently to run WNEW, Metromedia's flagship New York station. "As far as the fourth network goes, it sounds like fun, but it depends on people a lot higher up than me."
The growth of WTTG is part of an overall trend monitored by the Association of Independent Television Stations. The association's figures show that between 1975 and 1984, the number of independent TV stations has grown from 80 to 214. In the same period, advertising revenue of independents soared from $401 million -- a 16 percent share of all spot TV revenue -- to $2.2 billion, a 24 percent share.
WTTG will do even better this year in terms of its share of the Washington market, analysts say.
"In 1985, I have them at $52 million in station revenues and 40 percent profit," said Thomas Buono, of Broadcast Investment Analysts Inc., a Chantilly, Va., research firm. "We are estimating 1985 net revenues will exceed $200 million in the D.C. market for all the stations combined . . . and they get $50 million, you are looking at over 25 percent of the market's revenues."
What began as the first television station in Washington 40 years ago on V-E Day has come a long way. One broadcaster recalls the evening news back in 1959.
"At 9 p.m., a clock would come on and the second hand would go around for 60 seconds and you would hear this voice reading you the headlines," he said. "They would do one minute of headline news a day -- that's it, that was their commitment to news."
The original $2.5 million studio housed only eight staffers and broadcast only 20 hours a week.
Channel 5 now has 240 employes, 50 of them part-timers, and broadcasts 150 hours each week to 61 counties in seven states and the District of Columbia. The number of viewers reached by the Channel 5 signal has soared from about 700,000 in 1956 to nearly 3 million, with a little help from about 140 cable systems that carry the signal.
Today, the station is celebrating its official 40th anniversary with special programs such as "Forty Years Together" and a car giveaway on "P.M. Magazine" -- gestures far beyond the dreams of original owner Allen B. DuMont, a pioneer in the television industry who developed the cathode-ray tube and set up TV stations in Washington and New York.
In 1959, John W. Kluge, a German immigrant and food brokerage owner, bought a controlling share in the DuMont network and changed the name to Metropolitan Broadcasting Corp. That network, which later became Metromedia Inc., now includes five TV stations in Dallas, Houston, New York, Los Angeles and Chicago. A seventh station, in Boston, has been spun off to Hearst Corp.
Metromedia's profits in 1982 -- the year before the company went private -- were $309 million.
Channel 5's ratings -- and hence, its advertising revenue -- began to soar about 1979, thanks to good rerun programming that became available to independent stations.
WTTG also has been helped by federal regulations that prohibit networks from having a financial interest in any programming except that which they produce on their own, as well as rules that do not allow a network to control syndication of programming.
"In terms of attracting advertising, M.A.S.H. was the first syndicated program that had the ability to draw," said a researcher at a major New York advertising spot sales firm. WTTG acquired M.A.S.H. and later "Fame" and "Too Close for Comfort," shows the networks had let go that became hits, drawing advertising dollars.
"The independents are on the par with the affiliates; they have all started to become more respectable, delivering higher quality, newer reruns and first-run programming," said the researcher.
Many advertisers have been known to hold a negative attitude about independent television stations, which were thought to draw less-affluent and less-educated viewers.
But "the traditional bias that independents don't deliver high-income, higher-education audience has been proven untrue by research," said Deborah Cover-Lewis, who handles accounts at the advertising agency Needham Harper Worldwide.
Essentially, Channel 5 delivers good numbers in terms of percentage of audience during the "fringe" hours of 4 p.m. to 8 p.m., before ABC, NBC and CBS prime-time shows take over, she said. WTTG features "good syndicated shows, good movie packages and delivers numbers competitive to prime time at a much, much more reasonable price" than the networks do, she said.
Of the station's total advertising accounts, 60 to 70 percent are national, say industry sources. WTTG is especially attractive to advertisers because its programming is watched by a key consumer audience 18 to 49 years old.
"It's a very successful station -- the financial rewards have been excellent over the last two years," said O'Brien, adding that there was a 30 percent increase in revenue during his two years with the station.
Analysts currently value the station at between $250 million and $300 million.
"You have a technical factor, a competitive factor and a management factor all contributing to this success," said researcher analyst Buono. Channel 5 has a competitive edge because only one other independent station -- WDCA-Channel 20, owned by Taft Broadcasting Corp. -- broadcasts in Washington. Channel 5 also has a technical advantage because of its VHF signal, he said; Channel 20's UHF signal is weaker.
WTTG has had strong leadership in former station manager Kevin O'Brien and a triumvirate of powerful women, all vice presidents, who run the programming, promotional and news operations. Once referred to as "Kevin's Angels," Sandra Pastoor, Lindy Spero and Betty Endicott are now known as "Bob's Bad Girls."
"It's the happiest, most exciting, most stimulating place I've ever worked," said O'Brien. But when he first arrived two years ago, the station wasn't quite like that.
"I determined a great weakness in the station in the news operation and locally produced programming . . . the morale of the employes was at an all-time low -- prior management forgot about them."
O'Brien immediately made changes. First, "native son" Maury Povich was brought back to the station after 10 years to star on the 10 o'clock news. Then the company began to sink about $4 million into upgrading news facilities. It also hoped to air its 10 o'clock news program on stations across the country. But the plan didn't work out after the company realized the market among independent television stations was less than anticipated.
O'Brien also added 20 employes to the news department and increased the news crew from three to seven. New promotion executives, in combination with programming, increased the audience share 7 percentage points in two years.
The channel's hallmark of running good rerun programming caught on among the network stations, O'Brien said. "Imitation is the severest form of flattery," he noted.
Now the station is positioned for further growth under the new ownership.
O'Connor has nothing but good things to say of Murdoch and Barry Diller, chief executive officer of Twentieth Century-Fox who was hired recently from Paramount Pictures.
"They are programming developers. Barry Diller turned around the first-run syndication business," O'Connor said. The station now will have a direct programming pipeline with Twentieth Century-Fox. "We will pay for it, and a lot, but it will just make the negotiations easier," he said, adding that Murdoch "has a commitment to news -- I think that's very exciting."
While the general view is that such a move isn't at the top of Murdoch's agenda, the station is thinking about taking the news national again.
"We are all wondering," said Endicott, news director at the station. "It's always been a dream. The idea has never died. We have a corps that could be expanded to take on a national newscast." Discussions are under way with Gannett Co. to present national news in encapsulated USA Today style.
WTTG also is gearing up to add more people to its sales force and will be fighting for good programming to complement it, Pastoor said. Nevertheless, she said, there is a real programming shortage in the industry because major networks go for quick fixes in terms of ratings and do not give a show a chance; as a result, there are not many new episodic reruns available, and independents will be a doing a lot more coproducing.
"You'll see more TV stations getting involved with Twentieth Century-Fox to create a syndicated project," she said. There also will be more coproduction of local programming between stations, she added.
Independents such as WTTG generally have to learn to fend for themselves in station promotion as well, according to creative services director Spero. "We promote ourselves like a network. . . . We started out playing catch-up, and now I like to think the opposite," she said.
A lot remains to be seen, however, when Murdoch takes over the station that, in O'Brien's words, can be "run on a lunch break."
Consultants say Murdoch takes a hands-on approach in his assets. "I don't think there is any doubt it is going to change from the way Kluge ran it," said one consultant familiar with Murdoch's Australian stations. "Kluge let Metromedia president Bob Bennett run it, and Bennett let O'Brien run it. I watched the way Murdoch took over the Australian stations -- he wants to know what programs are on, he gets that specific."
"But if I had just bought that group of stations, and I were going to make up a list of problems, Washington would be the last."