Why Little-Known Northpoint Scares Directv Scare Cable
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Dog days for TV stox I 30P non-ev: nt I 60-69 bids on hold 7, 2000 r- www.broadcastingcable.com Northpoint execs ( -r) Toni Coak C- Bush, Sophia Collier and 0 Katherine mm Reynolds PM 00 4 n< zz t.11 <a. x-¡Z 30 =00 x00 Z-r- ADZ OE iATI x Q X- xan WM xci) F-0 *-.40E-4EZ *0 13-4 *NZO 400i-4*. Why little-known Northpoint scares DirecTV and Echo Star -and should scare cable Family Friendly Forever CASEYGWEF'.'JER C I S T R I B U T I O N, L_ G 2000 T-ie Çe?aeyiWernar Cumpaay.LLC. All Rigbt+ Nesevee Ali U,,' _ a+i registeree trader. listed sWdCs are PeM!ee by the applrcaole crgpnixaiion awards ó SOLL ALI ACROSS ' ERIC1 Fall 201:0 AMERICA IS SOLD ON BILL COSBYI 1999 Peoples Choice -All -Time Favorite Male TV Performer NAACP Image Award - Best Comedy Series - COSBY Kennedy Center Honoree 1996 People's Choice - Best Actor /TV Series NAACP Image Award - Best Comedy Series - COS$Y 1994 Author - New York Times Bestseller List 1991 NAACP Image Award - Best Actor /Comedy Series Author - New York Times Bestseller List 1988 People's Choice -All Time Favorite TV Star People's Choice - Favorite All- Around Male Entertainer People's Choice - Favorite Male TV Performer Author - New York Times Bestseller List 1987 People's Choice - Favorite Male TV Performer -. People's Choice - Favorite All- Around Male Entertainer 1956 Golden Globe - Best Performance/TV Series Peoples Choice - Favorite Male TV Performer People's Choice - Favorite All-Around Male Entertainer NAACP Image Award - Medgar Evers Medal of Honor Grammy - Best Comedy Recording 19 &5 Emmy- THE COSBYSHOWW Outstanding Comedy Series 1984 Golden Globe - Best Actor/Comedy Series People's Choice - Favorite Male Performer - New TV Program 1978 Emmy - Outstanding Children's Special 1969 Grammy - Best Comedy Recording 1968 Emmy - Best Actor/Dramatic Series Grammy- Best Comedy Recording 1%7 Emmy - Best Actor/Dramatic Seriesr Grammy - Best Comedy Recording 1966 Emmy - Best Actor/Dramatic Series Grammy - Best Comedy Performance 1965 AND Grammy - Best Comedy Performance 1964 Grammy - Best Comedy Performance OW... BroadcasfigiCable August 711000 www.broadcastingcable.cam Volume 130 Number 33 TOP OF THE WEEK / 4 Dog days for TV stocks Reluctant investors see televi- GOP non- sion as a slow -growth sector going forward./ 4 event The Radio days Naseau abandons ¡PO, but Entravision's gets full story warm reception. / 9 behind the lack of a News feed NBC and Tribune stations team up with Feed - story in Room to offer broadband content. / 12 Philadelphia. On his own Thoigh way below Kathie Lee's final week, /16 Live With Regis bea_s last year's weekly rating by 42 %. / 13 Tom Brokaw anchored 60-69 bids on hold Wireless bidders see delay of spec- coverage on trum auction as a way to get a handle on costs. / 20 MSNBC and NBC. For more late-breaking news, see "In Brief" on pages 68-69 Northpoint BROADCASTING / 31 execs (l -r) COVER STORY / 22 Katherine Laura's woes Sears pulls ads from controversial radio Reynolds, Sophia show; little effect seen for Dr. Laura fall TV series. / 31 Collier and Antoinette Gridiron buzz Addition of comic Dennis Miller makes Cook Bush Monday Night Football something to talk about. / 32 Signing off A piece of radio history goes quiet as 78- year -old WMAQ Chicago shuts down. / 34 CABLE / 38 Memory loss CAB survey shows viewers forget com- mercials on both broadcast and cable networks. / 38 You're out! New York judge sides with MSG and orders Yankees to shelve plans for a sports network. / 38 41 TECHNOLOGY / 42 News over the Net Time Warner Cable bypasses satellite to deliver programming to local news channels. 142 Interference trial KERA -Tv Dallas -Fort Worth tests ADC transmitter to reduce adjacent -channel problems. 142 9®hy lit le- E ? A. known North- Rights fight The battle over downloading copyrighted point scares 111111.0 content is headed for the video front. 144 DirecTV and EchoSta Changing Hands 50 Editorials 70 Nielsen Ratings...36,37,40 -and should Classifieds 60 Fates & Fortunes 57 Open Mike 58 scare cable Closed Circuit 13 Fifth Estater 56 Station Break 35 root Cutting Edge 43 Financial Wrap Up 9 Washington Watch 21 Datebook 52 Get w /the Program 34 Dot's New Media Cafe ...46 Hooked Up 41 AUGUST 7, 2000 / BROADCASTING & CABLE 3 TOP OF THE WEEK Media's millennium malaise Granite is hit hard, but 2000 has been tough year for stagnating stocks on Wall Street By Steve McClellan isn't any rosier because investors just very frustrating." don't see from where future revenue Executives at Tribune and Gannett, The second quarter was particularly growth is going to come. two of the biggest TV- station owners tough for Granite Broadcasting. At "We've only participated in TV have also watched their stocks hover near a time when WB stations around when we've absolutely had to," says 52 -week lows, despite fairly positive the country have been realizing double - Larry Haverty, the entertainment and earnings growth this year. Tribune was digit revenue growth, Granite's WB sta- media analyst at State Street Research, trading around $33 last week, just above tions showed a 1% decline in revenue. the Boston -based investment concern. its yearly low of $30.81, despite posting Same -station broadcast cash flow The best example of that is Viacom and double -digit revenues and profits in its dropped 17 %. The day after releasing CBS, in which State Street has owned broadcasting sector in the second quarter. results on Monday, July 31, Granite's shares for several years. "We were real- Gannett's stock has been on a steady stock dipped to a yearly low of just ly more interested in the radio aspects decline since March and last week traded under $4.72 per share, where it contin- of CBS," he says. "The TV turnaround at $53.75, not far from its yearly low of ued to trade for much of last week. $52.87. Last December, the stock was It has been a tough time in media -land trading at $83.75. The company's news- this year for cable and broadcast sectors; TAKING A DIP paper results have far outshone its broad- last week, it was just Granite's turn. casting operations so far this year. In the Company executives knew there io ii first half, broadcast operating income would be some rough questions from Granite's stock price was up just 2% to $168 million on rev- analysts on a conference call to discuss 8 enues of $372 million, up 4.6 %. Newspa- results. But they had to be surprised per income is up 19 %, to $677 million, , when Omega Advisors' Lee Cooper- on revenues of $1.8 billion, up 21 %. man asked pointedly if Granite execu- 6 Belo watched its stock drop from tives would just sell the company so $20.50 last September to $12.31 on that investors could get some return on 4 Feb. 25, and executives there have been t their shares and take advantage of the obsessed with raising it ever since. huge discrepancy between Granite's (February was a down month for a lot of public and private valuations. Granite's 2 TV stocks: That's when Granite agreed breakup value is estimated by analysts to pay NBC $362 million for a 10 -year to be $20 a share or greater. 0 affiliation deal for KNTV San Jose.) The question, coming from such a Feb. 28.'00 July 31,'00 Belo's stock had been stalled between widely respected investment -funds $16 and $17 for most of the spring and manager -known for buying long Dollars summer but recently popped to more term -in such a public setting was Since February, Granite than $19, after its board approved a 25 clearly a slap at Granite's management. Broadcasting's stock price has million share buyback authorization "It was more than a rude guest at a dipped to as low as $4.72 Analysts that could cost $430 million. wedding," quipped one analyst on the estimate the company's breakup Sinclair Broadcast Group's stock value at $20 a share. conference call. "It's rare for an price is about 50% below its 52 -week investor to ask a sensitive question like high of $21.87, largely because its that on the earnings call. Usually, those was a bonus." operating results continue to under - kinds of discussions are held off-line." Hearst Argyle issued what most ana- whelm Wall Street. Cooperman was clearly expressing his lysts said were pretty solid second - Cable's been sliding since late Janu- frustration at what he feels is a less than quarter numbers two weeks ago, ary, when investors got anxious about adequate return on his stock in Granite, including a 10% gain in broadcast cash the pace of operators' cash flow growth. which he first purchased in 1992 when flow, to $98.5 million, on a 6% climb in Those fears were realized two weeks ago the company went public. Neither Coop- revenue, to $196.5 million. Pro forma when usually- steady Cox Communica- erman nor Granite TV Chairman Don revenue was up 6.5% for the first six tions missed its cash flow targets and the Cornwell could be reached for comment months while broadcast cash flow was simply- massive AT &T Broadband post- at deadline last week. up 13.5 %. Not bad, and yet its stock ed a sharp decline. Cable stocks dropped But frustration sums up the feelings price is trading at about $19, just above 10% to15% on that news, recovering of many media company executives and its 52 -week low of $18.75.