Case study and analysis: Portugal TVI media / broadcasting company

Chapter_5_Strategy_and_Competition_in_the_New_Broadcast_Industries.pdf

Home >Business & Finance homework help >Marketing homework help >Case study and analysis: Portugal TVI media / broadcasting company

Chapter 5

Strategy and Competition in the New Broadcast Industries

The environmental changes that have occurred since the 1980s as a result of technological advances and shifting audience demands have impacted the broadcast media profoundly. As the pioneer of electronic media products, the conventional characteristics of radio as a local, over-the-air commercial medium have to be reexamined as commercial-free satellite radio subscrip- tion services have become popular nationally among many music lovers and as technologies have enabled the delivery of radio signal worldwide via the Internet and the arrival of customized music CDs and portable music players (e.g., iPod). Broadcast television, once a favorite of most American media consumers, now competes against multichannel programming ser- vices such as cable and DBS as well as streaming content on the Internet. The broadcasters now have to fight for shares in a fragmented audience market, invest heavily in digital technology, and rethink their strategic role in a con- solidated media marketplace where most competitors are verticall inte- grated and operate businesses in many other media sectors.

It is evident that the general environment for broadcasters has changed dramatically. But how have these external forces shaped today’s broadcast market? Adopting the strategic framework proposed in chapter 2, this chapter attempts to answer this question with a review of the economic, technological, political, and sociocultural changes that have influenced the state of broadcast industries and discusses the factors that have affected the competitive dynamics of both the broadcast radio and television markets.

CHANGES IN THE GENERAL ENVIRONMENT

Elements in the broader context of a society influence the operations of industries and the firms within them. Although firms have no control

76Chan-Olmsted, S. M. (2005). Competitive strategy for media firms : Strategic and brand management in changing media markets. Retrieved from http://ebookcentral.proquest.com Created from ashford-ebooks on 2019-03-14 15:39:51.

C o p yr

ig h t ©

2 0

0 5 . R

o u tle

d g e . A

ll ri g h ts

r e se

rv e d .

over these environmental changes, they can respond to them with ap- propriate strategies. Followings are some major trends that have im- pacted the broadcast media industries.

Economic Changes

Several economic developments have indirectly shaped the direction and nature of today’s broadcast media. First, the growth of a global economy has positively contributed to the market potential of broadcasters. The fact that most television broadcast networks are integrated with produc- tion studios means that the development of a global programming mar- ket would lessen the programming financing burdens of television broadcasters as more overseas media outlets become potential revenue sources. The interconnectedness between different media systems also presents more coproduction cost-sharing/reduction opportunities. Sec- ond, the relatively low interest rates in various time periods between the 1980s and 2000s fostered a favorable environment for mergers and ac- quisitions, which gave birth to numerous media conglomerates and cre- ated many consolidated local broadcast markets. The development of larger media groups means a different strategic role for today’s broad- casters when their corporate parents compete multilaterally (i.e., multipoint competition). Finally, because the U.S. economy grew more than 56% in gross domestic product (GDP) per capita from 1980 to 2000, we are faced with a more affluent media consumer who can afford new subscription or pay-per-event media services that compete with the tra- ditionally free broadcast products. Note that the economic condition of the United States, a market economy, also directly impacts the core in- come source—advertising revenues—for broadcasters. By comparison, the broadcasters have had a mere 16% increase in total ad revenues since 1996, whereas their cable counterparts, which only partially rely on ad- vertising income, had a 150% increase (Standard & Poor’s, 2004). The at- tractiveness of the cable sector often means the development of more alliances and/or consolidations between broadcasters and cablecasters.

Technological Changes

The technological advances in computing and communication technolo- gies in the last two decades have brought tremendous changes to the broadcast industries. There are continuous product innovations in com- puting devices that enable the widespread ownership of personal com- puters and network connections, which take shares from media consumers’ investment in broadcast media products and leisure time. There are new digital communication technologies that facilitate the de- livery of digital signals and make better audio-visual quality, more con- tent options, and interactivity possible and even demanded. Most evidently, although the arrival of cable, satellite, and Internet/broadband distribution technologies has reduced the dominant position of broad-

NEW BROADCAST INDUSTRIES I 77

Chan-Olmsted, S. M. (2005). Competitive strategy for media firms : Strategic and brand management in changing media markets. Retrieved from http://ebookcentral.proquest.com Created from ashford-ebooks on 2019-03-14 15:39:51.

C o p yr

ig h t ©

2 0

0 5 . R

o u tle

d g e . A

ll ri g h ts

r e se

rv e d .

casters, advances in digitization and compression have also offered broadcasters new business opportunities. More recently, the introduction of personal digital recorders and on-demand content services is beginning to transform how audiences use the television medium, prompting the need to reevaluate the existing broadcast business model of a free over-the-air commercial system. In essence, the continued technological evolution has redefined the nature and boundaries of broadcast products as well as how and how much the consumers use broadcast products.

Political Changes

Beginning with the sweeping changes brought about by the Telecommu- nications Act of 1996, the regulatory environment of broadcast indus- tries has been largely relaxed to encourage cross-media competition and the introduction of new media technologies. The adoption of more liberal ownership rules by the Federal Communications Commission (FCC) has made it easier for broadcasters to own a number of broadcast properties as well as develop cross-media ownership. These deregulatory moves ef- fectively facilitate the application of cross-promotion strategies, sharing of resources, and negotiation power of broadcast group owners. In es- sence, the recent deregulatory development has changed the strategic op- tions and priorities for many broadcasters, making corporate strategies a critical aspect of competition. There also have been global political changes toward privatization and commercialization of media systems. The opening of media borders and commercialization means the option of global diversification and increase of programming demands and thus revenue potential for the vertically integrated U.S. broadcasters.

Sociocultural and Demographic Changes

Sociocultural and demographic changes have profound impacts on the broadcast business because these external forces ultimately shape the au- dience type, size, preferences, and behavior. A number of developments in this area have influenced the market for broadcast products. First, the ag- ing of the baby boomer audience segment has widened the desirable age bracket for broadcast advertisers, thus somewhat altering the program- ming approach (e.g., more health-related content) and competitive posi- tions of different broadcasters. Second, the growing income disparity between different socioeconomic audience segments has pushed further the application of market segmentation strategy, a specialty for cablecasters rather than broadcasters. Third, more women in the workforce as well as increasing workplace diversity have significant im- plications in both programming content and scheduling strategies. In general, most television broadcasters’ conventional day-parting schedul- ing and general-appeal programming strategies seem to be less respon- sive to such societal developments. Fourth, the attitudes toward quality of life and environment have influenced both broadcasters’ promotional

78 I CHAPTER 5

C o p yr

ig h t ©

2 0

0 5 . R

o u tle

d g e . A

ll ri g h ts

r e se

rv e d .

approaches and news focuses. For examples, the busy lifestyle of today’s audiences has resulted in diminishing audience loyalty and leisure time, which prompted the increase of programming modularity (i.e., shorter plot lines) and cross-platform marketing. Finally, the fast growth of two demographic groups—the Hispanic and African American markets—has considerable connotations for the programming and diversification strategies of broadcasters. The lure of the increasing Hispanic population and its buying power has spawned a new array of Spanish radio formats and the acquisitions of Spanish programming sources (e.g., NBC’s acqui- sition of Telemundo). The expansion of the African American demo- graphic segment also has some notable programming and marketing implications for broadcasters because anecdotal evidence suggests that this segment comprises a large number of young people and spends more on cable services and entertainment than the general population.

CHANGES IN BROADCAST INDUSTRIES

As depicted previously in chapter 2, the external environment of an in- dustry shapes the nature and state of competition between the firms op- erating in it. Accordingly, the aforementioned changes have impacted the relationships between broadcasters in the market and the strategies adopted by these firms. To examine these competitive dynamics and their implications, we adopt Porter ’s five-force competition assessment framework, reviewing the bargaining power of suppliers, bargaining power of buyers, threat of substitute products, threat of new market entrants, and rivalry among competing firms.

Bargaining Power of Supplier

In the context of broadcast markets, suppliers are the content produc- ers/suppliers for broadcast networks and stations. Historically, the bar- gaining position of the television content suppliers was not particularly strong because broadcast television networks and stations held the control of the conduits to audiences. With the proliferation of electronic media out- lets (i.e., the number of content buyers has increased), the content suppliers have garnered somewhat more bargaining power. Nevertheless, the active consolidations at both the network and station levels seem to have also so- lidified the countering negotiation power of the broadcast buyers. For ex- ample, the formation of large station groups has resulted in a significant increase of television broadcasters’ bargaining power over syndicators. Ta- ble 5.1 shows the considerable numbers of stations and extensive reach controlled by the top network/station groups. It is virtually impossible to launch a new syndicated program without the support of these station groups. In addition, in recent years, television broadcasters have attempted to mitigate the power of content suppliers through vertical integration. As a result, all broadcast television networks are now affiliated by ownership with major studios (see Table 5.2).

NEW BROADCAST INDUSTRIES I 79

C o p yr

ig h t ©

2 0

0 5 . R

o u tle

d g e . A

ll ri g h ts

r e se

rv e d .

T A

B L

E 5

.1 To

p B

ro ad

ca st

Te le

vi si

o n

S ta

ti o n

G ro

u p

C o rp

o ra

te O

w n e r

V ia

c o m

N e w

s C

o rp

D M

A S

iz e

C B

S N

e tw

o rk

(3 )a

U P N

N e tw

o rk

(6 )

F o x

(1 )

R e a

c h

S ta

ti o n

# R

e a

c h

S ta

ti o n

# R

e a

c h

S ta

ti o n

1 –5

19 .8

(1 9.

8) b

6 2

1 7

.6 (1

4 .7

) 7

(o f

3 ar

e U

P N

af fil

ia te

6 –1

0 6

.1 (5

.2 )

3 1 .9

(0 .9

) 4

1 0

.0 (8

.9 )

7 (o

f 1

ar e

U P

N af

fil ia

te s)

1 1 –2

5 6 .3

(6 .3

) 5

6 .6

(4 .8

) 6

1 2 .2

(9 .6

) 13

(o f5

ar e

U P N

af fil

ia te

2 6 –5

0 0 .7

(0 .7

) 1

3 .9

(1 .9

) 6

4 .2

(4 .2

) 6

5 0 +

0 .9

(0 .7

) 2

0 0 .6

(0 .6

) 2

S u b

to ta

l 3

3 .8

(3 2

.7 )

1 7

1 2

.4 (7

.7 )

1 8

4 4

.6 (3

7 .9

) 35

(o f9

ar e

U P N

af fil

ia te

T o

ta l

4 6

.2 (4

0 .3

) 3

5 4

4 .6

(3 7

.9 )

3 5

C o rp

o ra

te O

w n e r

N B

C -U

n iv

e rs

a l

D is

n e y

T ri

b u

n e

(2 )

D M

A S

iz e

N B

C (4

) T

e le

m u

n d

o (7

) A

B C

(5 )

W B

A ff il ia

te s

F o x /A

B C

A ff il

ia te

R e a

c h

S ta

ti o n

# R

e a

c h

S ta

ti o n

# R

e a

c h

S ta

ti o n

# R

e a

c h

# R

e a

c h

1 –5

1 9 .9

(1 9 .9

) 6

0 4

19 .8

(1 9.

8) 5

1 7 .6

(1 6 .2

) 4

0 0

6 –1

0 4 .1

(4 .1

) 2

2 .2

(1 .1

) 2

0 0

8 .2

(4 .1

) 4

0 0

1 1 –2

5 2 .8

(2 .8

) 2

3 .0

(1 .5

) 3

1 .7

(1 .7

) 1

9 .0

(7 .0

) 7

1. 2(

0. 6)

2 6 –5

0 3 .2

(2 .3

) 4

2 .2

(1 .4

) 3

0 .9

(0 .9

) 1

2 .5

(1 .2

) 3

1 .3

(0 .6

) 4

5 0

+ 0

0 0

.9 (0

.4 )

2 1 .3

(1 .1

) 3

0 .5

(0 .3

) 1

0 0

S u b

T o

ta l

3 0 .1

(2 9 .1

) 1 4

8 .3

(4 .5

) 1 4

23 .7

(2 3.

5) 1 0

3 7 .8

(2 8 .8

) 19

2. 4(

1. 2)

T o

ta l

3 8 .3

(3 3 .6

) 2 8

2 3 .7

(2 3 .5

) 1 0

4 0 .2

(3 0 .0

) 2 6

N o

te .

C o

m p

ile d

fr o

m “T

o p

2 5

S ta

tio n

G ro

u p

s” (2

0 0

4 ).

a R an

ki n

g o

f th

e st

at io

n g

ro u

p ’s

re ac

h in

th e

U n

ite d

S ta

te s.

N o

te th

at V

ia co

m w

ill b

e th

e n

u m

b er

o n

e g

ro u

p w

h en

C B

S an

d U

P N

st at

io n

s ar

e co

m b

in ed

. (D

M A

= D

es ig

n at

ed M

ar ke

t A

re a)

b F

ir st

n u m

b er

is th

e ac

tu al

au d

ie n

ce re

ac h

as a

p er

ce n

ta g e

o f

th e

n at

io n’

s te

le vi

si o

n h

o u se

h o

ld s.

S ec

o n

d n

u m

b er

is th

e re

ac h

ac co

rd in

g to

th e

F C

C d

is co

u n

te d

d ef

in iti

o n

fo r

U H

F st

at io

n s.

C o p yr

ig h t ©

2 0

0 5 . R

o u tle

d g e . A

ll ri g h ts

r e se

rv e d .

T A

B L

E 5

B ro

ad ca

st Te

le vi

si o n

N et

w o rk

an d

th ei

r A

ff ili

at e

P ro

d u ct

io n

P ro

p er

ti es

C B

S &

U P

N (V

ia co

m )

Fo x

(N ew

s C

o rp

o ra

tio n

) N

B C

(N B

C U

n iv

er sa

l) A

B C

(D is

n ey

) W

B (T

im e

W ar

n er

)

A ff il ia

te P ro

d u

c ti

o n

P ro

p e rt

ie s

C B

S P

ro d

u ct

io n

s C

B S

Te le

vi si

o n

C ity

K in

g W

o rl

d P

ro d

u ct

io n

s S

p el

lin g

Te le

vi si

o n

V ia

co m

P ro

d u ct

io n

s B

ig T

ic ke

t Te

le vi

si o

n D

N A

P ro

d u ct

io n

Fo x

Te le

vi si

o n

S tu

d io

s 2

0 th

C en

tu ry

Fo x

Te le

vi si

o n

Tw en

tie th

Te le

vi si

o n

U n

iv er

sa lS

tu d

io s

N B

C S

tu d

io s

W al

t D

is n

ey Te

le vi

si o

n W

al t

D is

n ey

A n

im at

io n

To u ch

st o

n e

F ilm

s B

u en

a V

is ta

P ic

tu re

W ar

n er

B ro

s. Te

le vi

si o

n W

ar n

er B

ro s.

S tu

d io

s Te

le p ic

tu re

s P

ro d

u ct

io n s

T B

S P

ro d

u ct

io n

N o

te .

C o

m p

ile d

fr o

m O

n eS

o u

rc e

(2 0

0 4

C o p yr

ig h t ©

2 0

0 5 . R

o u tle

d g e . A

ll ri g h ts

r e se

rv e d .

For the radio market, its content suppliers, mainly the major record companies, had relatively strong bargaining power when most stations were independently owned. With the consolidation of local stations in recent years, radio station groups now control the lifeline of these music labels through the selection of their playlists. The recent controversy in the practice of “pay-for-play,” whereby record companies pay inde- pendent promoters to get their singles on radio playlists, is an excellent example of such a power struggle. The “payola” laws prohibit radio sta- tions from accepting payment in exchange for playing certain songs, but the addition of the middleman—the independent promoters—has enabled radio stations to sidestep the laws. It was estimated that the re- cording industry spent more than $150 million in 2004 on pay-for-play, with labels paying anywhere from $250,000 to $1 mil- lion to get and keep a single on the radio (Hoovers Online, 2004). Many independent record companies have complained about the tremendous negotiation power of large radio groups such as Clear Channel and Viacom (Infinity). In summary, although the suppliers in the broadcast industries have generally grown in importance, the trend toward verti- cal and horizontal integration has also elevated the position of the broadcast buyers and, at the same time, amplified the significance of ef- fective corporate strategies.

Bargaining Power of Buyer

In the context of broadcast markets, there are two groups of buyers for broadcast products: audiences and advertisers. From the perspective of the audiences, the source of their power resides in the investing of their “time” in the programming offered by one of the broadcast outlets. Have broadcast audiences become more or less powerful amid the envi- ronmental changes discussed earlier? Broadcast audiences have histori- cally possessed significant power over broadcasters because they are indirectly the only source of income for broadcasters. Such power has been strengthened further as the audiences are now presented with more alternative products from other media systems that they could switch to at little cost. In addition, the availability of abundant informa- tion about alternative products through a wide variety of sources in- cluding the Internet has shifted even more power to media consumers. Nevertheless, although losing ground in some less differentiated pro- gramming areas, television broadcasters still possess certain unsubstitutable products (e.g., the Super Bowl) that they can use to maintain some degree of negotiation power over audiences. It is impor- tant not to minimize the power of these superproducts because they might serve as the most effective marketing avenues to build other products to compete with the competitors’ offerings. For example, tele- vision broadcasters have been very successful in developing and pro- moting reality-based programming (e.g., promotion of Survivor during

82 I CHAPTER 5

C o p yr

ig h t ©

2 0

0 5 . R

o u tle

d g e . A

ll ri g h ts

r e se

rv e d .

Super Bowl breaks), although the origin and acceptance of this pro- gramming genre can actually be traced to cable networks such as MTV with the Real World series.

From the perspective of advertisers, historically they have also been powerful because their purchases constitute the only major revenue source for broadcasters. Nevertheless, there is a balancing intricacy in this relationship because advertisers traditionally also have been largely dependent on broadcasters to promote their products. Although the essentiality of the broadcast media as the primary advertising conduit still holds true today, there has been a gradual shift in validating the ef- fectiveness of other advertising alternatives and in questioning the value of the tremendous investment in the broadcast media as audiences migrate to other newer media. To counter such a potential tip of market power, broadcasters now have to contemplate ways of minimizing the effect of ad revenue loss through diversification of ownership into other media sectors or new broadcast business models that diversify their rev- enue sources.

Threat of Substitutes

By definition, substitutes are different products from outside of an in- dustry that perform the same or similar functions as a product that the industry offers (Hitt, Ireland, & Hoskisson, 2001). In the context of broadcast markets, multichannel video programming distributors (MVPD) such as cable television and DBS services are logical substitutes for broadcast television products, and geographically unconfined audio services through new media conduits such as online streaming audio content and satellite radio services are likely substitutes for the tradi- tional radio broadcast products. The key to gauging the degree of threat posed by substitute products is to assess two factors: how hard it is for audiences to switch to the substitute and how valuable is the differenti- ated quality of the substitute to the audiences. From the perspective of radio broadcasters, as the prices of portable, customizable music devices such as iPod and satellite radio services like XM and Sirius continue to decrease, the switching cost to migrate to these competing services is getting lower. The radio broadcasters, especially the music format sta- tions that do not offer differentiated local, editorial added value, are fac- ing an increasing threat from these substitutes. In addition, Internet radio, though still not self-sustaining financially in its current state, also offers a variety of content unmatched by local stations and is a strong substitute for certain listeners (Ren & Chan-Olmsted, 2004). From the perspective of television broadcasters, it would be fair to con- clude that the switching cost to cable is minimal (perhaps a bit more for DBS in the initial investment of time and money, but the difference is disappearing as well). In addition, MVPDs have been relatively success- ful in differentiating and demonstrating the value of their program-

NEW BROADCAST INDUSTRIES I 83

C o p yr

ig h t ©

2 0

0 5 . R

o u tle

d g e . A

ll ri g h ts

r e se

rv e d .

ming products. As a result, ad-supported cable had acquired a prime-time audience share of 50.3% in 2003, versus a combined 44.8% for the four major broadcast networks (Standard & Poor ’s, 2004). To counter the threat posed by the MVPD substitutes, broadcasters have ei- ther diversified into the MVPD sector (e.g., NBC’s investment in MSNBC and CNBC) or attempted to differentiate their products along the dimen- sions that the audiences might value (e.g., sports, celebrity sitcoms, re- ality-based shows, etc.). The presence of increasing competition, in essence, reveals the importance of branding for today’s broadcasters.

Potential Entrants

Because of the substantial barriers against entry into broadcast indus- tries, there is little continuous threat of potential entrants to the existing incumbents. With the addition of Fox and two other minor networks, the market of broadcast television networks seems to have reached its saturation point with declining audience market shares and the fact that most local stations have already aligned with a network. Further- more, the entry barriers, namely, governmental policy (e.g., localism), economies of scale (e.g., ownership of many stations, especially in ma- jor markets), and access to distribution channels or programming (e.g., network affiliation or high-profile programs), are likely to persist in these markets. In other words, existing broadcasters can expect minimal threats posed by potential entrants to their markets to further divide up the shrinking market shares or dilute their bargaining power with sup- pliers or buyers. There is also very limited room for new entrants to the radio market as the radio syndication and network segment is already crowded with suppliers although there has been no increase in the num- ber of local radio stations. The growth of large radio station groups also means a tremendous scale economy advantage possessed by these group owners.

Internal Rivalry Intensity

The nature of competition in broadcast industries has changed signifi- cantly since the 1980s with the injection of more broadcast networks, the growth of station groups, and the formation of media conglomer- ates with broadcast holdings. Specifically, in the television industry, there has been a slight increase in the number of competitors, which typically contributes to more rivalry intensity. Nevertheless, the exis- tence of a still relatively small number of equivalent competitors (e.g., the big four networks or the major affiliates in a local market) points to oligopolistic, mutually dependent behavioral patterns (i.e., the don’t-rock-the-boat syndrome). By comparison, radio markets are gen- erally more crowded and thus more competitive, but the growth of ra- dio station groups has also led to more strategic, selective competition (e.g., format saturation). In fact, faced with a stagnant industry with

84 I CHAPTER 5

C o p yr

ig h t ©

2 0

0 5 . R

o u tle

d g e . A

ll ri g h ts

r e se

rv e d .

little growth, many broadcasters have chosen the strategy of differenti- ation rather than direct pricing competition because differentiated products typically induce loyalty, which lessens the need for the rivalrous behavior that might lower a firm’s profitability.

Although conventional wisdom tells us that with more competitors and saturating consumer demands, there should be more rivalry in the broadcast industries, the result is really best reflected by the strategic stakes of broadcast properties as an investment for diversified media corporations, considering the extent of media consolidations involving broadcast outlets in recent years. As Hitt et al. (2001) put it, competitive rivalry is more intense when achieving success in a particular industry is crucial to most companies. In other words, broadcasters’ competitive rivalry is also determined by the importance of success in the broadcast sector in influencing a media conglomerate’s effectiveness in other mar- kets. In this context, broadcasters are strategically significant in that they offer the most extensive brand communications channels and effi- cient cross-promotional tools for their corporate owners. Broadcast sta- tions also generate one of the highest profit margins compared to other media sectors (Albarran, 2001). Thus, it is still crucial for media con- glomerates to compete aggressively in broadcast markets. In essence, the rivalry in broadcast markets today is more intense but different. The concentration of ownership means a certain degree of mutual depend- ency with selective rivalry. Competitive behavior is more likely to be based on corporate interests rather than responses to local or single-sec- tor rivalry.

Several themes seem to permeate throughout our discussions thus far of the changes impacting the broadcast media: (a) the development of networks and ownership groups that make corporate and alliance strategies more relevant nowadays, (b) the transforming role of broad- cast networks that requires a more holistic, resource-based reexamina- tion of the broadcast business, (c) the necessity of brand management that goes beyond tactical applications but is also full of application chal- lenges, and (d) the reformulation of business models that might allevi- ate broadcasters’ reliance on one single revenue source and perhaps make them more competitive in the new digital marketplace. The fol- lowing sections elaborate on each of these themes.

FORMATION OF STRATEGIC NETWORKS AND CONSOLIDATED OWNERSHIP

Chapter 3 alluded to the benefits of corporate acquisition and alliance strategies for gaining access to critical resources, reducing costs, gener- ating scale/scope economies, improving competitive positions, and en- tering new markets. Evidence shows that broadcasters have adopted these strategies in their attempt to align with the changing environ- ment. The following section assesses the specific approaches they have taken and examines the implications of these actions.

NEW BROADCAST INDUSTRIES I 85

C o p yr

ig h t ©

2 0

0 5 . R

o u tle

d g e . A

ll ri g h ts

r e se

rv e d .

Strategic Alliances

Why do broadcasters choose to form alliances and how have they allied? Adopting an RBV approach of strategic network formations, we first in- vestigate the drivers for alliances in this market. From an RBV perspec- tive, strategic alliances are formed because firms seek partners that have resources complementary to their own or allow them to acquire new ca- pabilities (Eisenhardt & Schoonhoven, 1996; Harrison, Hoskisson, & Ireland, 2001). Strategic alliances can take a variety of forms. Das and Teng (2000) categorized alliances in terms of dichotomy of alliance structure: equity alliances versus nonequity alliances, differentiated by the creation or absence of new entities, or ownership transfer of existing entities (Gulati, 1995). As described in chapter 3, Das and Teng further suggested that a firm will prefer an equity joint firm if it primarily con- tributes property-based resources, and its partner primarily contributes knowledge-based resources; a firm will prefer a minority equity alliance if it primarily contributes knowledge-based resources, and its partner primarily contributes property-based resources; a firm will prefer a bi- lateral contract-based alliance if both partner firms primarily contrib- ute knowledge-based resources; and a firm will prefer a unilateral contract-based alliance if both partner firms primarily contribute prop- erty-based resources. Utilizing the Das and Teng alliance typology, Liu and Chan-Olmsted (2003) found that the broadcast television net- works’ preferences for alliance structure were indeed influenced by the resources they brought to the alliances. In cases of expansion into online businesses, broadcasters used their property-based resources as a basis to form alliances with Internet firms, and in return they acquired access to the Internet firms’ knowledge-based resources that were essential to their Internet strategies. Liu and Chan-Olmsted also noticed that this group of broadcasters was most interested in developing flexible access to content (knowledge) resources (e.g., minority equity alliances with niche Web sites that are content-based firms). Specific alliance examples include NBC’s partnership with iVillage, CBS’s investments in the con- tent sites MarketWatch and SportsLine, and News Corp./Fox’s align- ment with Yahoo!

It is also our observation that broadcasters have attempted to capital- ize on the growth of new media services through strategic alliances with members of the Internet, computing, and other media markets in the following three categories: community/content building, access facili- tating, and e-commerce enabling.

Community/Content-Building Alliances. Broadcasters have formed alliances aimed at building virtual communities of similar interests, topical or geographic. For example, CBS partnered with ThirdAge, a Web destination that offers news, expert advice, and self-assessment tools with interactive chat and forums to create an online community of baby

86 I CHAPTER 5

C o p yr

ig h t ©

2 0

0 5 . R

o u tle

d g e . A

ll ri g h ts

r e se

rv e d .

boomers. NBC entered an agreement with TalkCity, which in turn pro- vided chat room services for NBC.com. NBC also invested in iVillage.com and created a presence in a virtual community of women. Similar to the attempt to enrich the overall media experience of their au- diences through virtual communities, broadcasters have also formed al- liances to enhance their content competency, and they have even been contemplating the possibility of collaborating with local television sta- tions to offer multichannel services using the new digital spectrum. For instance, NBC, Hearst-Argyle Television, and Gannett Broadcasting formed a syndication-programming development and distribution partnership to share their content resources and capabilities (McClellan, 2000). NBC also entered programming joint ventures with MGM and Court TV, and Tribune Broadcasting entered a programming joint ven- ture with Universal Television Enterprises (McClellan, 2002a, 2002b). The community- and content-building effort is critical because it offers brand identity–building opportunities and brand image assessment av- enues, as well as a way of interactively connecting with audiences, which would compensate the broadcast media for its characteristicly in- adequate, one-way appeal to a general audience.

Access-Facilitating Alliances. Broadcasters have formed alliances to ensure that they are one of the players in the emerging, converging Internet-led broadband world of media. Specifically, they have tried to ex- plore new ways of reaching audiences and distributing their contents on multiple platforms through partnerships. For example, Granite Broad- casting Corp. entered an alliance with WB Network to form a Fort Wayne, Indiana, cable television station (“Granite Broadcasting Alliance,” 1999). NBC allied with Videoseeker, a video directory that offered stream- ing online content in entertainment, news, business, and shopping. Through an agreement with AOL, CBS is the exclusive broadcast news provider to AOL. CBS.SportsLine.com serves as the primary sports con- tent provider for AOL, Netscape, and Excite. To position themselves for the potential convergence between online and television content, the network broadcasters sought partnerships with computer and network heavy- weights such as Microsoft (with NBC), Oracle (with CBS), and Compaq (with ABC) (Elkin, 2000; “Walt Disney Internet,” 2000). To facilitate their technological capability in the new digital marketplace, the broadcasters have also allied with firms that produce software for interactive televi- sion. For instance, NBC invested in DigitalConvergence.com to facilitate its plan to allow NBC viewers to watch NBC programming and advertis- ing via their personal computers interactively (Mermigas, 2000). Such strategic networks are important in that they reduce the risk of equity di- versification into a new emerging market that is critical for the future of broadcast products while speeding up the broadcasters’ entrance into a new media market with their partners’ knowledge (e.g., online market- ing experience) and property (e.g., proprietary software) resources.

NEW BROADCAST INDUSTRIES I 87

C o p yr

ig h t ©

2 0

0 5 . R

o u tle

d g e . A

ll ri g h ts

r e se

rv e d .

E-Commerce-Enabling Alliances. Broadcasters have also formed alliances to explore new business models via the Internet conduit. By al- lying with the e-commerce experts, broadcasters seek to develop addi- tional revenue sources and experiment with the Internet’s effectiveness in paid content delivery (e.g., selling fee-based or subscription content products) and online merchandising (e.g., selling program or station merchandise). Besides numerous partnerships between e-commerce de- velopers/stores and local broadcasters, networks such as NBC entered partnerships with leading e-commerce sites like Auto-By-Tel, Golf.com, Polo.com, and Preview Travel (Kaufman, 2000). ABC was affiliated with Pets.com (now Petsmart.com) and MBNA.com, an online banking ser- vice, whereas CBS, through its parent company, Viacom, allied with e-commerce sites such as RX.com and MVP.com. The alliances with e-commerce partners, although not most critical to the future direction of broadcasters, are significant in that they give broadcasters the oppor- tunity to develop online content distribution capabilities and experience in exploring nontraditional business models.

Mergers and Acquisitions

Under the justification that the nation is moving toward electronic abun- dance and that broadcasters increasingly face new electronic entrants and should be fully free to meet these new competitors, media ownership rules have been relaxed since the early 1980s. As a result of the deregula- tory climate as well as other environmental changes discussed in chapter 1, broadcast markets have witnessed tremendous waves of mergers and acquisitions. Many significant transactions occurred in the 1990s. There were conglomerate mergers such as the Westinghouse-CBS, Disney-Cap- ital Cities/ABC, and GE/NBC-Vivendi Universal deals; concentric mergers such as the Tribune Co.-Renaissance Communications Corp., Viacom-CBS, and News Corp.-New World Communications transac- tions; vertical mergers such as the acquisition of King World by CBS and Paramount by Viacom; and station group combinations such as those be- tween Hearst-Argyle and Pulitzer Broadcasting, Chancellor Media and LIN Television, and Fox and Chris-Craft. In the other broadcast market, there were major combinations of radio groups such as the mergers of Westinghouse/CBS-Infinity, Liberty Broadcasting-SFX Broadcasting, Sinclair Broadcast Group-River City Broadcasting and Sullivan Broad- casting, and Clear Channel’s acquisition of Paxson’s station properties (Bodipo-Memba & Brannigan, 1997; Brown, 1998a, 1998b; “Disney to Acquire,” 1995; Freeman, 1996a, 1996b; Gay, 2000; Heuton, 1995; Laureen, 1995; Miller & Jensen, 1996; Sherman, 2004; “Time Warner to Buy,” 1995; Trigoboff, 2001; “Westinghouse Will Make,” 1995). Today’s radio station group owners such as Clear Channel have more than 1,000 local stations (see Table 5.3). These major mergers and acquisitions changed the competitive dynamics in broadcast industries by creating

88 I CHAPTER 5

C o p yr

ig h t ©

2 0

0 5 . R

o u tle

d g e . A

ll ri g h ts

r e se

rv e d .

horizontally consolidated, vertically integrated markets and giving birth to more multimedia conglomerates.

THE NEW NETWORK BUSINESS

It is evident that the content packagers—broadcast networks—have en- countered the most dramatic environmental changes among all broad-

NEW BROADCAST INDUSTRIES I 89

TABLE 5.3

Top 25 Radio Station Groups

Rank by Revenue Radio Station Group Corporate Owner

#of Stations

1 Clear Channel Clear Channel Communications 1,216

2 Infinity Viacom 185

3 Cox Radio Cox Enterprises 78

4 Entercom Entercom Communications 104

5 ABC Radio The Walt Disney Co. 74

6 Citadel Citadel Broadcasting Corp. 216

7 Radio One Radio One Inc. 66

8 Emmis Emmis Communications Corp. 27

9 Cumulus Cumulus Media Inc. 270

10 Univision Univision Communications Inc. 57

11 Susquehanna Susquehanna Pfaltzgraff Co. 33

12 Bonneville Deseret Management Corp. 35

13 Greater Media Greater Media Inc. 19

14 Spanish Broadcasting

SBS Broadcasting 27

15 Salem Salem Communications Corp. 92

16 Jefferson-Pilot Jefferson-Pilot Corp. 17

17 Beasley Beasley Broadcast Group Inc. 41

18 Saga Saga Communications Inc. 71

19 Entravision Entravision Communications Corp. 58

20 Regent Regent Communications Inc. 76

21 Journal Broadcast Journal Communications Inc. 36

22 NextMedia Next Media Group LLC. 60

23 Inner City Inner City Broadcasting Corp. 19

24 Sandusky Sandusky Radio Inc. 10

25 Lotus Lotus Communications Corp. 24

Note. Data compiled from “Ad Sales Show” (2003).

C o p yr

ig h t ©

2 0

0 5 . R

o u tle

d g e . A

ll ri g h ts

r e se

rv e d .

casters in the last two decades, especially in the television industry. Amid the growth of the MVPD services, broadcast television networks are fighting for a much smaller audience share while at the same time trying to figure out their strategies in the new digital media market full of opportunities as well as risks. The decisions the networks make also have rippled effects on different parts of the industry. For instance, as the traditional scripted shows gave way to reality-based programming, there was a reduction of programming products in the syndication pipeline. Nevertheless, CBS became the highest-ranked network re- cently in overall demographics thanks to this programming approach (Standard & Poor ’s, 2004). The competitive picture today is very differ- ent from the time when the big three networks garnered almost all the primetime-viewing shares and held the upper-hand bargaining position with both the upstream producers and downstream stations.

Exactly how has the network business evolved in response to all the challenges? Using an RBV approach, we examine here how these broad- casters have adapted to the environment by investigating the evolution of network resources since the rise of MVPD services. Note that as a firm’s environments become turbulent and uncertain, the relevance and flexibility of its resources become more significant to achieving success (Chatterjee & Wernerfelt, 1988). Similarly, the network broadcasters would have to acquire specific resources to achieve competitive advan- tage and profitability during this period.

Landers and Chan-Olmsted (2004) reviewed precisely the changing property and knowledge resources during four time periods of increas- ing uncertainty (i.e., 1985, 1990, 1995, and 2001). They noted that property-based resources of station ownership, market reach, and over- all/top content properties seem to become more prominent as the net- work television market becomes more unstable or uncertain. Affiliate contracts and top content property appear to be critical property-based resources for the minor networks in their attempt to gain market shares. Network news, on the other hand, does not seem to be influ- enced by the fluidity in the market as a property resource. As for the knowledge-based resources, the “breadth” of human resources such as media employee pools and multipurposing expertise appears to grow in importance as the market becomes more volatile. International exper- tise, mostly in forms of cable programming expansion, is also becoming more vital. Generally, access to a diverse set of knowledge resources (in product and geography) seems to become more essential as the level of uncertainty in this media market increases. As for the resource attain- ment strategies, Landers and Chan-Olmsted also observed that whereas NBC was aggressive in acquiring certain property-based resources such as broadcast media and affiliate contracts properties, developing some knowledge-based resources like management and audience expertise, and employing a “focus” strategy of building electronic media outlets and content, CBS and Fox emphasized expanding property resources such as O&O stations and top content properties. Fox was especially

90 I CHAPTER 5

C o p yr

ig h t ©

2 0

0 5 . R

o u tle

d g e . A

ll ri g h ts

r e se

rv e d .

successful in developing competitive content expertise that aided its seg- mentation strategies.

The analysis thus far reveals that channel/content access and exper- tise in expanding, marketing, or coordinating into other media domains are crucial resources in the changing broadcast television market. View- ing these resources now in the broader context of corporate resources (i.e., broadcast networks as a resource of media conglomerates), we can see that the broadcasters’ contribution to their corporate owners is nec- essarily shifted. Table 5.4 shows the top U.S. media conglomerates’ di- verse holdings and the fact that half of them own at least one broadcast network. Historically, without the complicated affiliations with firms from other media sectors and the presence of multipoint competition, the network business was the source of television programming and what defined a television station. Today, networks play the multifaceted roles of a content developer (for multiple media outlets), channel man- ager (on behalf of the stations), lead cross-media promoter, and brand-marketing tone setter. After GE-NBC’s acquisition of Universal from Vivendi, the media conglomerate is already actively pursuing a strategy of integrating Universal’s studio assets with those of NBC and marketing its Universal movie properties via DVD and other MVPD net- works with NBC’s promotional arms. In conclusion, the network busi- ness has evolved from a one-dimensional programming distributor to a critical platform for executing corporate strategies.

BROADCAST BRAND MANAGEMENT

Marketing researchers have long advocated that managers need to start managing their brands more like assets—increasing their value over time (Keller, 1993). Management has to invest in understanding its brand to- day to make better brand decisions tomorrow. Such a notion holds true for the broadcast industries as well. As the theory of “brand life cycle” suggested, a brand, if well managed and perceived, may enter a stage of fortification with the utility of leveraging a brand’s value by extending the brand to other related product categories (Liebermann, 1986). With the arrival of digital media technologies, broadcasters have the opportu- nity to explore new media services that may bring new revenues and/or develop competitive advantages. A successfully branded broadcaster has the foundation on which to begin such service expansions.

Among all broadcasters, radio stations are most experienced in branding related marketing techniques such as segmentation, differen- tiation, and positioning. Because of their narrowcasting nature, radio broadcasters have long embraced the idea of assessing the audience per- ceptions of their stations (i.e., brand images). On the other hand, with the product of traditionally mass-appeal content, television broadcast- ers have approached the branding concept quite differently.

The three major broadcast networks have historically branded them- selves based on their news divisions and newscaster personalities.

NEW BROADCAST INDUSTRIES I 91

C o p yr

ig h t ©

2 0

0 5 . R

o u tle

d g e . A

ll ri g h ts

r e se

rv e d .

T A

B L

E 5

.4 To

p U

.S . M

ed ia

C o n g lo

m er

at es

an d

T h ei

r M

ed ia

H o ld

in g s

R a n k

C o m

p a n y

To ta

l N

e t U

.S .

M e d ia

(I n

m il .,

2 0 0 3 )

B ro

a d c a s t

N e tw

o rk

s /S

ta ti

o n

M V P D

T V /F

il m

P ro

d u

c ti

o n

/ D

is tr

ib u

ti o

n P ri

n t

O th

e r

1 T

im e

W ar

n er

$ 2

9 ,2

4 7

T h

e W

B N

et w

o rk

T im

e W

ar n

er C

ab le

B ri g h

t H

o u se

H B

O T

B S

C N

N C

ar to

o n

N et

w o

rk T

N T

C o

u rt

T V

C in

em ax

W ar

n er

B ro

s. P

ic tu

re s

W ar

n er

B ro

s. S

tu d

io s

W ar

n er

B ro

s. Te

le vi

si o

n Te

le p

ic tu

re s

P ro

d u

ct io

n C

as tle

R o

ck E

n te

rt ai

n m

en t

Tu rn

er E

n t.

N et

w o

rk N

ew L in

e C

in em

a F

in e

L in

e Fe

at u re

T im

e In

c. W

ar n

er B

o o

ks L itt

le ,

B ro

w n

, &

C o

A m

er ic

a O

n lin

e W

ar ne

r B

ro s.

R ec

or ds

T h

e A

tla n

tic R

ec o

rd in

2 C

o m

ca st

C o

rp .

$ 1

7 ,4

9 2

C o

m ca

st C

ab le

C o

m ca

st S

p o

rt sN

et E

! E

n te

rt ai

n m

en t

G o

lf N

et w

o rk

O u

td o

o r

L ife

N et

w o

rk S

ty le

Q V

C 3

V ia

co m

$ 1

7 ,2

5 2

C B

S N

et w

o rk

U P

N N

et w

o rk

V ia

co m

S ta

tio ns

G ro

up C

B S

R ad

io In

fin ity

B ro

ad ca

st in

g C

or p.

M T

V B

E T

N ic

ke lo

d eo

n N

ic k

at N

ite C

M T

V H

1 S

p ik

e T

V C

o m

ed y

C en

tr al

S h

o w

tim e

T h

e M

o vi

e C

h an

n el

F L IX

Pa ra

m o

u n

t P

ic tu

re s

Pa ra

m o

u n

t Te

le vi

si o

n C

B S

P ro

d u

ct io

n s

C B

S Te

le vi

si o

n C

ity K

in g

W o

rl d

P ro

d u ct

io n

s S

p el

lin g

Te le

vi si

o n

V ia

co m

P ro

d u

ct io

n s

B ig

T ic

ke t

Te le

vi si

o n

D N

A P

ro d

u ct

io n

S im

o n

& S

ch u st

er T

h e

Fr ee

P re

ss B

lo ck

b u

st er

V ia

co m

O ut

do or

Fa m

o u s

M u si

c P

u b lis

h in

4 N

ew s

C o rp

./ D

ire cT

V $ 1 5 ,2

2 4

a Fo

x N

et w

o rk

Fo x

S ta

tio n

s G

ro u

p U

P N

S ta

tio n

s G

ro u p

Fo x

S p o

rt s

R ad

io N

et w

o rk

s C

h ri

s- C

ra ft

In d

u st

ri es

D ir ec

T V

Pa n A

m S

at Fo

x S

p o

rt s

N et

Fo x

M o

vi e

C h

an n

el Fo

x N

ew s

C h

an n

el F

X N

at io

n al

G eo

g ra

p h

ic C

h .

S p ee

d C

h an

n el

2 0 th

C en

tu ry

Fo x

F ilm

Fo x

Te le

vi si

o n

S tu

d io

s 20

th C

en tu

ry Fo

x Te

le vi

si on

Tw en

tie th

Te le

vi si

o n

H ar

p er

C o

lli n

s P

u b lis

h in

g T

V G

u id

e N

ew Yo

rk Po

C o p yr

ig h t ©

2 0

0 5 . R

o u tle

d g e . A

ll ri g h ts

r e se

rv e d .

5 W

al t

D is

n ey

C o .

$ 1

1 ,2

3 9

A B

C N

et w

o rk

A B

C S

ta tio

n s

G ro

u p

A B

C R

ad io

R ad

io D

is n

ey E

S P

N R

ad io

A B

C Fa

m ily

T h

e D

is n

ey C

h an

n el

E S

P N

A &

E T

h e

H is

to ry

C h

an n

el L ife

tim e

E ! E

n te

rt ai

n m

en t

W al

t D

is n

ey P

ic tu

re s

W al

t D

is n

ey Te

le vi

si o

n W

al t

D is

n ey

A n

im at

io n

To u ch

st o

n e

F ilm

s B

u en

a V

is ta

P ic

tu re

s P

la tin

u m

D u n

es P

ro d

D is

n ey

P u b lis

h in

g B

u en

a V

is ta

M u si

6 N

B C

U n

iv er

sa l

$ 8

,1 7

7 N

B C

N et

w o

rk N

B C

S ta

tio n

s G

ro u

p Te

le m

u n d

o N

et w

o rk

Te le

m u

n d

o S

ta tio

n s

G ro

u p

PA X

N et

w o

C N

B C

M S

N B

C B

ra vo

U S

A S

ci -F

i Tr

U n

iv er

sa lP

ic tu

re s

U n

iv er

sa lS

tu d

io s

U n

iv er

sa lT

el ev

is io

n N

B C

S tu

d io

U n

iv er

sa l

M u si

7 C

ox E

nt er

pr is

es $ 8 ,1

0 8

C ox

T V

S ta

tio ns

G ro

up C

ox R

ad io

S ta

tio ns

G ro

C ox

C om

m un

ic at

io ns

C ox

N ew

sp ap

er s

Tr ad

er P

u b

lis h

in g

8 G

an n

et t

C o

. $

6 ,3

3 0

G an

n et

t S

ta tio

n G

ro u p s

U S

A T o d a y

T h

e D

e tr

o it

N e w

s T

h e

In ia

n a

p o li

s S

ta r

T h e

C in

c in

n a ti

E n q u ir

e r

T h

e T e n

n e s s e a

n T

h e

C o

u ri

e r

J o

u rn

a l

A s b u

ry P a rk

P re

s s

T h

e D

e s e rt

S u

9 C

le ar

C h

an n

el $

6 ,1

3 8

C le

ar C

h an

n el

S ta

tio n

s G

ro u

p C

le ar

C h

an n

el R

ad io

S ta

tio n

s K

at z

M ed

ia G

ro u

C le

ar C

ha nn

el O

u td

o o

1 0

A d

va n

ce P

u b

lic at

io n

$ 5

,9 0

9 O

p er

at io

n s

w ith

T im

e W

ar n er

C on

de N

as t

P ub

lic at

io ns

T h

e B

u si

n es

s R

ev ie

w H

er al

d C

o m

p an

y Fa

ir ch

ild P

u b

lic at

io n

s N

ew h

o u

se N

ew sp

ap er

s T

h e

S ta

r L ed

g er

O re

g o

n ia

n P

u b

lis h

in g

N o

te .

D at

a co

m p ile

d fr

o m

“1 0

0 L ea

d in

g M

ed ia

” (2

0 0

4 ),

“W h

o O

w n

s W

h at

” (2

0 0

4 ),

an d

O n

eS o

u rc

e (2

0 0

4 ).

a T o

ta la

m o

u n

t fo

r b

o th

co m

p an

ie s.

C o p yr

ig h t ©

2 0

0 5 . R

o u tle

d g e . A

ll ri g h ts

r e se

rv e d .

Branding via news programming seems to be widespread among local stations because local news often generates ratings, revenues, and visi- bility for these stations (Upshaw, 1995). The continuity and consistency of a news brand is especially important for an affiliated station as it tries to capitalize on the lead-in power of its network’s news brand and the more established, identifiable overall network brand. A survey of local television station managers revealed that the local broadcasters had a very high awareness of the branding concept (Chan-Olmsted & Kim, 2001). Nevertheless, they often treated branding as “promotional” tasks. In addition, although the managers believed that branding plays an important long-term strategic role in the success of a station, they frequently associated branding with tactical operations such as graphi- cal consistency, unique selling points for local news, and network affili- ation image. Station promotions and news functions were more readily identified as related to branding rather than to strategic management, and most branding activities included news-oriented promotions, net- work brand association, and station logo designs. This is not surprising considering the fact that the broadcast networks, the ones that local TV stations often model themselves upon, have embraced the term of branding mostly with a frenzy of logo designs as well as tactical place- ment of these signatures and promotion of the accompanying slogans. The same study also found that the managers’ commitment to brand research, not their industry experience, was linked to a more accurate understanding of branding. Also, the perceived long-term role of brand- ing is negatively related to managers’(general managers’) experience and current position in the industry. It seems that branding is a mana- gerial function that is applied more readily by an industry newcomer than a seasoned veteran. The same study also showed that market sizes matter in a station’s branding endeavor; the upper management in big- ger markets tended to hold a more positive, long-term view of branding, thus offering a better environment of building station brand equity.

Branding and the Internet

Chan-Olmsted and Kim (2001) found that most local television stations perceived the Internet as a good branding tool, especially for news. Ac- cording to the Internet Age Broadcaster Report released by the National Association of Broadcasters (NAB), two major strategic approaches have been adopted by broadcast networks: one used the Internet as a promotion tool for competing, and the other used the Internet to de- velop a better brand relationship with customers (Sonne, 1999). Lin and Jeffres (2001) also suggested that local TV stations use their online ven- tures to secure and enhance audience brand loyalty. Hashmi (2000) put forward that television networks generally perceived the Internet as a platform for repurposing, brand extension, and promotion. Along the same line of proposition, Chan-Olmsted and Ha (2002) concluded that broadcast television networks largely use the Internet to complement

94 I CHAPTER 5

C o p yr

ig h t ©

2 0

0 5 . R

o u tle

d g e . A

ll ri g h ts

r e se

rv e d .

their core off-line business (i.e., on-air content) rather than delivering new online content or generating e-commerce or online ad revenues.

So how have the broadcasters incorporated the Internet in their branding efforts? The broadcasters have utilized the Internet to enrich their off-line products by distributing a certain online content that takes advantage of the new medium’s capacity of interactivity and personal- ization. For example, ABC launched an Enhanced TV site that allows viewers to interact with its broadcasts of Monday Night Football. NBC created fresh online content for some of its series, such as Homicide, that allows users to get involved in solving crimes with a set of detectives not featured on the show. Fox started Sports Fantasy Network, one of the Web’s active fantasy sports leagues, and TooHotForFox.com, a site con- taining original content that is more provocative and thus not available on the Fox network. These online sites certainly contribute to the build- ing of network brand images. As broadcasters solidify their brand im- ages both on-air and online, it is possible for them to use the Internet beyond marketing purposes. Working toward a market/product devel- opment strategy, a broadcaster can even attempt to sell content prod- ucts online. The online distribution of content products, however, would be viable only when a broadcaster approaches the Internet with a brand identity that is based on solid, differentiated content.

NEW CHALLENGES AND OPPORTUNITIES: REFORMULATION OF BUSINESS MODELS

In response to the changing external environment, broadcasters have to revamp their traditional business models to diversify their revenue sources and position themselves for the opportunities offered by the new digital media marketplace. In exploring the applicability of differ- ent business approaches, this chapter now focuses on addressing three issues that have significant implications for broadcasters’ creation of new strategies: the development of digital television, which revolution- ized the capability of the television medium; the growth of satellite and Internet radio, which abolished the traditional geographic limitation of the radio medium; and the emerging broadcast-Internet business mod- els, which could serve as a blueprint for broadcasters’ expansion into new media businesses.

Digital Television: Opportunities and Challenges

Industry observers see the digital bandwidth, which enables high-defini- tion television, interactive television, and related commerce functions, as the next big thing in the Internet–TV converged world (Ha & Chan-Olmsted, 2004). The FCC specifically stated in its report that digital television (DTV) could enhance the ability of broadcasters to compete in the video marketplace (FCC, 2002). Different television broadcasters have approached the arrival of digital spectrum with various degrees of enthu-

NEW BROADCAST INDUSTRIES I 95

C o p yr

ig h t ©

2 0

0 5 . R

o u tle

d g e . A

ll ri g h ts

r e se

rv e d .

siasm. Whereas CBS and ABC are actively utilizing HDTV format during primetime, NBC and Fox are less aggressive in this endeavor. Compared to their U.S. counterparts, the Europeans have been much more successful with their consumers’ adoption of DTV. Some suggested that DTV is less successful in the United States for reasons such as expensive reception equipment and poor business models. Others argued that the lack of a comprehensive copyright protection plan has slowed the transition to DTV (FCC, 2002). Furthermore, in spite of the fact that over 85% of TV households in the United States receive their TV signals via multichannel media systems such as cable or satellite TV, cable carriage of local digital broadcast signals is still a hotly contested issue. In a nutshell, DTV has the capacity to deliver clearer pictures, multicasting, better sound, and inter- active functions for broadcasters. To speed up the DTV transition, the FCC has even imposed the mandate for TV set manufacturers to include digi- tal tuners capable of receiving DTV signals over the air in all new TV sets larger than 13 inches by July 2007 (Harbert, 2002).

As important as DTV is to the future of television broadcasters, Chan-Olmsted and Chang (2004) found that there is a very low level of DTV awareness and knowledge among American consumers. The own- ership of many entertainment and digital media was found to have an impact on how much consumers know about DTV. Consumer Internet usage and tenure were especially significant in increasing the knowl- edge of DTV. Interestingly, interactivity, the function that was touted as the critical driver for generating economic return for DTV, was consid- ered by the consumers to be the least important DTV benefit. The find- ings here point to a few marketing implications. First, in the fluid, emerging DTV market, an established broadcast brand could serve as a base of consumer trust and for the possible transfer of equity to the new DTV product. In addition, the Internet and other newer media are valu- able channels for communicating with potential DTV adopters. Second, as relevancy and fit are some of the keys to brand extension success, it is essential for broadcasters to contemplate these brand factors in their de- sign of new products for the digital shelf space. There is a real danger of diluting their existing broadcast brands with inappropriate expansions into other product categories simply for the sake of diversifying revenue sources. Third, multicasting during non-HDTV times of the day pres- ents an opportunity for broadcasters to develop differentiated brand identities to various audience segments, thus more effectively compet- ing with MVPD services. Fourth, individual functions that consumers can easily relate to with their current television usage experience (e.g., time shifting, better picture quality, and more content choices), rather than new utilities such as interactivity, might be a more attractive dif- ferentiating identity or selling point at the initial DTV-marketing stage. Finally, with a total expected conversion cost of $16 billion (McConnell, 2004), broadcasters would need to not only explore new revenue sources and ways of developing competitive advantages from the new digital spectrum but also diligently pursue strategic networks in this

96 I CHAPTER 5

C o p yr

ig h t ©

2 0

0 5 . R

o u tle

d g e . A

ll ri g h ts

r e se

rv e d .

process. For example, 12 station groups formed the Broadcasters’ Digi- tal Cooperative, a coalition of stations that dedicate part of their digital television space to distribute data by renting the spectrum to companies that want to distribute broadband data such as Internet content, digital audio files, or business-to-business information. Such an alliance ap- proach is essential in an uncertain environment because it reduces the risk of introducing new products, shares partners’ resources, and is able to test different business models much more quickly.

Satellite and Internet Radio: Redefining the Radio Medium

Satellite radio, a subscription-based service, offers about 60–100 chan- nels of mostly commercial-free music, news, sports, and talk program- ming to subscribers that utilize a satellite antenna and receiver to receive the signal. The two major satellite radio providers, Sirius Satellite Radio Inc. and XM Satellite Radio Holdings Inc., offer a wide range of content that is unmatched by traditional radio services and are aggressively forming alliances with different outlets for the distribution of their ser- vices. For example, both companies have relationships with the major automakers, as well as car rental companies, which call for dozens of car models to come equipped with factory- or dealer-installed satellite radio receivers. Sirius Satellite Radio’s digital broadcasts became avail- able free of charge to some subscribers of DISH Networks (“Sirius Of- fered,” 2004). Sirius is also exploring distribution agreements with cable operators. Through a partnership with Dell, XM is getting into the Internet music business by way of a subscription-based online radio service. In response to the rapid development of satellite radio in recent years, major radio station groups such as Clear Channel plan to begin limiting the number of commercials on more than 1,200 stations. Cit- ing the desire to better compete with satellite radio, the radio industry leader, Clear Channel, also decided to improve the sound quality of its radio stations by aggressively converting 1,000 of its 1,200 stations to digital radio within 3 years at a cost of about $100,000 per station (”Ra- dio Giant Moves,” 2004). It is evident that as the switch cost for satellite TV becomes minimal, radio broadcasters, mostly through their corpo- rate owners, are attempting to counter the differentiated value of satel- lite radio, namely, broadcast quality, commercial elimination, and variety. It is our assertion that although all these are important, local- ism would still be the key differentiating point for radio broadcasters. Thus, stations with brand images based on music variety, sound qual- ity, or uninterrupted programming are likely to be more vulnerable as satellite radio continues to grow.

Internet radio, which includes terrestrial radio stations streaming online and Internet-based radio stations as defined in the context of this discussion, has grown tremendously since the late 1990s. According to Arbitron, American Internet users are not only flocking to the Internet for radio material, they are listening for up to 5 hours per week

NEW BROADCAST INDUSTRIES I 97

C o p yr

ig h t ©

2 0

0 5 . R

o u tle

d g e . A

ll ri g h ts

r e se

rv e d .

(Arbitron, 2004). There are many inherent differences between the two groups of Internet radio stations. Most terrestrial radio stations webcast material that is similar to their on-air programs, whereas the majority of the Internet-based radio stations offer alternative, nonmainstream music. Terrestrial radio stations typically regard their online presence as a way of adding value to their off-line content, but Internet-only radio stations often need to find innovative, multiple rev- enue sources based solely on their online content (Palumbo, 2002).

Ren and Chan-Olmsted (2004) investigated the differences between these two groups of Internet radio stations based on their Web content and discovered that whereas both of them provided extensive informa- tional content, Internet-based radio stations tended to be more con- scious in collecting users’ information and developing relations with users through more interactive Web functions. The study also found that although the two groups of radio stations operate under very dif- ferent economic structures, they both relied mostly on advertising reve- nues. However, Internet-based stations also attempted to derive additional revenues from subscription, e-commerce, and affiliated pro- grams. It is evident that Internet-based stations, although struggling to find a commercially viable means of operation, are able to differentiate themselves from the more established terrestrial webcasters by ways of unique content and personal relationships.

The impacts of Internet radio on traditional radio stations can be evaluated from two perspectives, its influence on audiences’ radio usage and its impact on terrestrial radio stations’ advertising revenues. Specif- ically, the development of Internet radio changes the competitive dy- namics in the radio market in three ways: (a) It added a new group of competitors that appeal to certain niche audience segments with more variety and personal appeals; (b) it added another dimension of compe- tition for traditional radio stations as online content became a tool for marketing and for adding value to off-line content; and (c) it added more choices for radio audiences in general. Note that most of these impacts do not directly take away local audience shares and thus advertising revenues from local radio stations; however, the influence on audiences’ radio usage and expectations of online radio experience have important implications for how traditional radio stations should reformulate their marketing strategies. It is our assertion that Internet-based radio sta- tions are unlikely to become major competitors of traditional radio sta- tions because the value of their differentiated quality is somewhat limited (i.e., limited popular content). On the contrary, the growth of Internet radio, fueled by many Internet-based radio stations, has trans- formed traditional radio stations into a multifaceted medium with un- precedented potentials. In essence, the characteristics of unlimited geographical reach and the enhancement that furthers the personable nature of radio, now available through the Internet medium, present an attractive opportunity for the radio industry to boost its competitive- ness in the increasingly crowded media marketplace.

98 I CHAPTER 5

C o p yr

ig h t ©

2 0

0 5 . R

o u tle

d g e . A

ll ri g h ts

r e se

rv e d .

Internet Business Models: A Work in Progress

Moving our focus again to television, television broadcasters have adopted a variety of Internet strategies, from outsourcing the Internet operations, utilizing the Web to create interactive advertising experi- ences, employing the Internet as a marketing tool for on-air content or station brands, and positioning Web sites as local portals, to producing content for enhanced television (Kerschbaumer, 2000). Specifically, var- ious surveys of television stations revealed that the news and promo- tions departments were most frequently impacted by the Internet, most stations had focused on utilizing their Internet operations to generate advertising revenues rather than to develop e-commerce or content on demand, and different broadcast groups have internalized the Internet with various approaches. For example, whereas CBS stations explored ways to package existing sales forces, content, and promotion into prof- itable Internet businesses, Fox stations focused on online branding and developing local personalities and content with a national infrastruc- ture and technical support. As NBC stations emphasized the building of local portals with their news products, station groups such as Tribune Broadcasting that also own newspaper properties integrated the print and broadcasting Internet operations to provide a more competitive lo- cal content. On the other hand, ABC stations worked toward a Web ver- sion of network–station programming relationships, whereas the Chris-Craft Industries stations developed niches that are data- base-driven (e.g., used cars and employment listings) and have immedi- ate revenue potentials. Most station groups have also invested in the broadband and wireless sector, and some have supplied information content to their local broadband systems to ensure a presence in the growing broadband market (Greene, 2000; Nitschke, 1999). With the arrival of digital television, many television broadcasters are even con- templating the feasibility of Web-enhanced television applications such as on-screen links to advertisers’ Web addresses, localized news services, late-breaking news, sports statistics, interactive polling, background to documentary material, online chat, and links to movie trailers and tick- eting services (Nelson, 2001; Pavlik, 2001).

Because business models that evaluate ways in which firms may lever- age the Internet to develop competitive advantage are still evolving, it is quite a challenge for firms to decide on the extent and approaches of in- volvement with this new medium. The development of an appropriate business model is especially critical as well as intricate for television broadcasters because the Internet offers an alternative distribution chan- nel for its products and strengthens its position with the audiences while at the same time it competes with television for audience attention.

Chan-Olmsted and Ha (2003) put forward a framework for analyz- ing Internet business models of television broadcasters (see Fig. 5.1). They proposed that firm-specific, internal forces such as the types of core products, changes required to integrate the Internet operations, de-

NEW BROADCAST INDUSTRIES I 99

C o p yr

ig h t ©

2 0

0 5 . R

o u tle

d g e . A

ll ri g h ts

r e se

rv e d .

pendency of the online revenue, relationships with channel members re- garding the Internet, size of the organization, market position, alliances relating to the Internet, and branding capability would affect a televi- sion broadcaster ’s Internet competency. Externally, market forces such as economic conditions, regulatory environment, technological devel- opment, and the audience’s Internet adoption rate and patterns would impact a television broadcaster ’s Internet competency. Consequently, depending on its competency, a television broadcaster may choose to utilize the Internet to generate revenues from the sales of online adver- tising space or sponsorships, e-commerce (i.e., selling either merchan- dise or per-unit content online), content subscription (i.e., charging online users a monthly subscription fee for the right to access exclusive content online), content syndication (i.e., selling exclusive online con- tent to other Web sites), and/or affiliate programs (i.e., receiving a per- centage of all sales generated by customers traveling through a station’s Web site to the online storefront of the partner). A broadcaster may use the Internet to reduce costs by managing its relationships with channel members like advertisers and programming syndicators more effi- ciently or by improving the overall operational efficiency within its sta- tion. The broadcaster may also utilize the Internet to support or complement its off-line operations by developing stronger customer (i.e., audience) relationships and collecting audience information through the Internet. It was suggested that most stations would have a

100 I CHAPTER 5

FIG. 5.1. A framework for analyzing broadcasters’ Internet business models.

C o p yr

ig h t ©

2 0

0 5 . R

o u tle

d g e . A

ll ri g h ts

r e se

rv e d .

combination of Internet operations that aim to accomplish multiple ob- jectives (Chan-Olmsted & Ha, 2003).

Based on the proposed framework, Chan-Olmsted and Ha (2003) surveyed television stations nationally and found that a broadcaster ’s Internet competency is critically dependent on its manager ’s view of the relative revenue contribution of the Internet. These broadcasters have also focused their online activities on building audience relationships, rather than generating online ad sales. In other words, the Internet was used as a “support” to complement their off-line core products. Stations also felt inadequate about selling or syndicating content via the Internet. In fact, the revenue potential of “content” is minimal as per- ceived by the managers. Although continuing to view the strategy of customer/audience relations management as critical, the stations also began to value the importance of audience intelligence and the cost-cut- ting utility of the Internet in managing channel relations. The findings of this study point to a mix of business models that first utilize the Internet as a supplemental medium for developing a relationship with the audience of an off-line core product, and continue to increase the value of this relationship by building better audience intelligence, which then, in turn, improves the stations’ ability to sell online ads and imple- ment e-commerce, thus harvesting the value of its Internet operations (see Fig. 5.2). It is likely that not all broadcasters would go through this progression of Internet business models because they have different re-

NEW BROADCAST INDUSTRIES I 101

FIG. 5.2. The Internet business models of television broadcasters.

C o p yr

ig h t ©

2 0

0 5 . R

o u tle

d g e . A

ll ri g h ts

r e se

rv e d .

sources and capabilities, set different goals for their Internet operation, and play different strategic roles in regard to their corporate holdings.

FINAL THOUGHTS

As the oldest incumbent in electronic media, broadcasters are facing the most threats from the emergence of new media services enabled by the tremendous technological advances in the last few decades. Although their primary revenue source, advertising, has not been significantly afftected, the fact that there have been a migration of audiences to the new media and a change of expections as well as consumption patterns indicates an urgent need for broadcasters to revamp their competitive strategies. This chapter identified several business and corporate strate- gies that seem to provide broadcasters with various ways to adapt to their changing environments. These strategies include: (a) consolida- tions/alliances that improve broadcasters’ negotiation power and effi- ciency, (b) Internet and digital spectrum ventures that compensate broadcasters’ one-way, mass-appeal shortcomings, (c) reexamination of networks’ marketing utility for media conglomerates, (d) application of brand management tools, and (e) consumer-centered, brand-sensi- tive experiments of different business models utilizing the new digital shelf space and the Internet. It is our assertion that the broadcast media will continue to strive, not as the previously general-appeal electronic media dominator, but as an essential media property that develops the resouces (e.g., programming content, brand names, etc.) and marketing capability necessary for a media corporation to compete in today’s un- certain, multifaced media environment.

REFERENCES

Ad sales show rebound in ’02. (2003, September 29). Broadcasting & Cable, 133(39), 10.

Albarran, A. B. (2001). Management of electronic media. Belmont, CA: Wadsworth/Thompson Learning.

Arbitron. (2004). Internet broadcast services. Retrieved December 17, 2004, from http://www.arbitron.com/onlineradio/home.htm

Bodipo-Memba, A., & Brannigan, M. (1997, June 24). Clear channel to buy Paxson radio holdings. The Wall Street Journal, p. B14.

Brown, S. (1998a, June 1). Hearst-Argyle picks up Pulitzer. Broadcasting & Ca- ble, 128(23), 12.

Brown, S. (1998b, April 8). Raycom adds stations from Malrite. Broadcasting & Cable, 128(15), 44.

Chan-Olmsted, S. M., & Chang, B. (2004). Consumer awareness and adoption of digital television: Exploring the audience knowledge, perceptions, and factors af- fecting the adoption of terrestrial DTV. Manuscript submitted for publication.

Chan-Olmsted, S. M., & Ha, L. (2002, August). Internet business models for broadcasters: How television stations perceive and integrate the Internet. Paper presented to the Communication Technology & Policy Division at the annual

102 I CHAPTER 5

C o p yr

ig h t ©

2 0

0 5 . R

o u tle

d g e . A

ll ri g h ts

r e se

rv e d .

meeting of the Association for Education in Journalism & Mass Communica- tion, Miami, FL.

Chan-Olmsted, S. M., & Ha, L. (2003). Internet business models for broadcast- ers: How television stations perceive and integrate the Internet. Journal of Broadcasting & Electronic Media, 47(4), 597–617.

Chan-Olmsted, S. M., & Kim, Y. (2001). Perception of branding among television station managers: An explanatory analysis. Journal of Broadcasting and Elec- tronic Media, 45(1), 75–91.

Chatterjee, S., & Wernerfelt, B. (1988). Related or unrelated diversification: A re- source-based approach. Academy of Management Best Paper Proceedings, pp. 7–11.

Das, T. K., & Teng, B. (2000). A resource-based theory of strategic alliances. Jour- nal of Management, 26(1), 31–61.

Disney to acquire Capital Cities/ABC. (1995, August 7). Corporate Growth Report Weekly (855), p. 7975.

Eisenhardt, K. M., & Schoonhoven, C. B. (1996). Resource-based view of strate- gic alliance formation: Strategic and social effects of entrepreneurial firms. Organization Science, 7(2), 136–150.

Elkin, T. (2000, February 7). Nortel bets $10 mil. on global CNN deal. Advertising Age, p. 61.

Federal Communications Committee. (2002). Ninth annual report on competition in video markets. Washington, DC: Author.

Freeman, M. (1996a, July 22). On top of the world. Mediaweek, 6(30), 2. Freeman, M. (1996b, April 22). Strength in numbers. Mediaweek, 6(17), 9. Gay, V. (2000, January 24). World domination. Mediaweek, 10(4), 40. Granite broadcasting alliance. (1999, October 6). The Wall Street Journal, p. 1. Greene, T. (2000, August 14). Verizon takes NorthPoint to make national DSL

move. Network World, 17(33), 10. Gulati, R. (1995). Does familiarity breed trust? The implications of repeated ties for

contractual choice in alliances. Academy of Management Journal, 38(1), 85–112. Ha, L., & Chan-Olmsted, S. M. (2004, April). Exploring the effects of cable televi-

sion web sites on cable television network branding and viewership. Paper pre- sented at the annual meeting of the Management and Sales Division of the Broadcast Education Association, Las Vegas, NV.

Harbert, T. (2002). FCC plays chip makers’ tune. Electronic Business, 28(10), 30.

Harrison, H. M., Hoskisson, R. E., & Ireland, R. D. (2001). Resource complementarity in business combinations: Extending the logic to organiza- tion alliances. Journal of Management, 27(6), 679–690.

Hashmi, Y. (2000). The impact of the internet. World Broadcast Engineering, 23(6), 26.

Heuton, C. (1995, December 4). The large get larger. Mediaweek, 5(46), 12. Hitt, M. A., Ireland, R. D., & Hoskisson, R. E. (2001). Strategic management: Com-

petitiveness and globalization (4th ed.). Cincinnati, OH: South-Western College. Hoover ’s Online. (2004). Retrieved November 19, 2004, from http://pre-

mium.hoovers.com/ Kaufman, L. (2000, February 18). NBC helps Ralph Lauren fulfill a multimedia

dream. The New York Times, p. C13. Keller, K. L. (1993). Conceptualizing, measuring, and managing customer-based

brand equity. Journal of Marketing, 57(1), 1–22. Kerschbaumer, K. (2000, September 25). TV & the Internet: Old meets new.

Broadcasting & Cable, 130(40), 55–58.

NEW BROADCAST INDUSTRIES I 103

C o p yr

ig h t ©

2 0

0 5 . R

o u tle

d g e . A

ll ri g h ts

r e se

rv e d .

Landers, D., & Chan-Olmsted, S. M. (2004). Assessing the changing network television market: A resource-based analysis of broadcast television net- works. The Journal of Media Business Studies, 1(1), 1–26.

Laureen, M. (1995, August 7). NBC picks up three stations. Mediaweek, 5(31), 4. Liebermann, Y. (1986). The advertising-to-sales ratio along the brand life cycle:

A critical review. Managerial and Decision Economics, 7(1), 43–48. Lin, C. A., & Jeffres, L. W. (2001). Comparing distinctions and similarities across

Web sites of newspapers, radio stations, and television stations. Journalism and Mass Communication Quarterly, 78(3), 555–574.

Liu, F., & Chan-Olmsted, S. M. (2003). Partnerships between the old and the new: Examining the strategic alliances between broadcast television net- works and Internet firms in the context of convergence. International Journal on Media Management, 5(1), 47–56.

McClellan, S. (2000, December 11). Partners in programming. Broadcasting & Cable, 130(51), 6.

McClellan, S. (2002a, June 17). Getting together—on something. Broadcasting & Cable, 132(25), 33.

McClellan, S. (2002b, April 15). A new repurposing arena. Broadcasting & Cable, 132(16), 7.

McConnell, B. (2004, March 15). Millions could be without TV. Broadcasting & Cable, 134(11), 5.

Mermigas, D. (2000, June 5). NBC’s fall lineup to spotlight new Web technol- ogy. Advertising Age, 3, 64.

Miller, J. P., & Jensen, E. (1996, July 2). Tribune to acquire TV broadcaster re- naissance. The Wall Street Journal, p. A3.

Nelson, K. (2001, March 19). Cable show put new technology on front burner. Electronic Media, p. 13.

Nitschke, A. (1999). Station Internet activities report. Washington, DC: National Association of Broadcasters.

100 leading media companies. (2004, August 23). Advertising Age, p. S4. OneSource. (2004). OneSource Online Business Information. Available from

http://www.onesource.com/ Palumbo, P. (2002). Streaming content sites favor advertising over subscrip

tion. Retrieved August 16, 2002, from http://www.streamingmedia.com/ article.asp?id=8240

Pavlik, J. (2001). Journalism and new media. New York: Columbia University Press. Radio giant moves to limit commercials. (2004, July 19). [Electronic version].

The New York Times. Ren, W., & Chan-Olmsted, S. M. (2004). Radio content on the World Wide

Web: Comparing streaming radio stations in the United States. Journal of Radio Studies, 11(1), 6–25.

Sherman, J. (2004, May 17). NBC Universal looks forward. Televisionweek, 23(20), 3.

Sirius offered To DISH subscribers. (2004, May 21). Satellite Today, 3(98), 1. Sonne, M. D. (1999). Technologies & new business directions for broadcasters. Re-

trieved July 10, 2001, from http://www.nab.org/Research/topic.asp Standard & Poor ’s. (2004). Retrieved November 19, 2004, from

http://www2.standardandpoors.com/servlet/Satellite?pagename=sp/ Page/HomePg

Time Warner to buy Turner Broadcasting. (1995, September 11). Corporate Growth Report Weekly (860), p. 8035.

Top 25 station groups. (2004, April 19, 2004). Broadcasting & Cable, 134(16), 56.

104 I CHAPTER 5

C o p yr

ig h t ©

2 0

0 5 . R

o u tle

d g e . A

ll ri g h ts

r e se

rv e d .

Trigoboff, D. (2001, August 6). Chris-Craft, Fox move in. Broadcasting & Cable, 131(33), 14.

Upshaw, L. B. (1995). Building brand equity. New York: Wiley. Walt Disney Internet, Compaq Computer set three-year pact. (2000, December

1). The Wall Street Journal, p. B2. Westinghouse will make a $80 per share bid for CBS. (1995, July 31). Corporate

Growth Report Weekly (854), p. 765. Who owns what. (2004). Columbia University’s Graduate School of Journalism,

Columbia Journalism Review. Retrieved December 17, 2004, from http://www.cjr.org/tools/owners/

NEW BROADCAST INDUSTRIES I 105

C o p yr

ig h t ©

2 0

0 5 . R

o u tle

d g e . A

ll ri g h ts

r e se

rv e d .