22 VIDEOAGE January 2024 Affiliates (Continued From Page 20) “Reverse Compensation” (RC), however, Rick Feldman, a former broadcaster and onetime president of NATPE when it was a TV association, reported, “I left KCOP in 2000. And it was just about then that RC was bubbling.” According to a former TV station group CEO who wants to remain anonymous, “Reverse comp was phased in with each station or group based on their individual contracts with each network. I believe it began around the mid to late 2000s and likely all affiliates were paying the networks for their affiliations by approximately 2012-2015. Again, it would have depended on individual contracts, which vary in length from likely about five years to as many as 10 back then. Currently, most of the deals are much shorter, probably around three years.” An ABC agreement with WSET-TV (Lynchburg, Virginia) as a “Primary Affiliate” for the 2013-2017 period indicated rules for “regularly scheduled programs”, “preemption reimbursement” (at 100 percent for primetime to 15 percent for daytime), and even “broadcast standards” to adhere to. As for the “local inventory level for local sales” within the network programming, the agreement set it at 50 minutes and 15 seconds per week. As for compensation, the agreement stated that the station would pay an annual fee (“payable in monthly installments”), plus retrans fees (paid by cable operators to local The 1990 edition of Stay Tuned, by Christopher H. Sterling and John M. Kittross, a book on the history of American Broadcasting. TV stations) for the networkprogramming portion. One question that VideoAge was not able to clarify was the term “Primary Affiliate,” seen in the agreement between ABC and WSET-TV. “I do not know what you mean by primary affiliate,” reported a former station group executive. “There are a few smaller markets where there are stations with dual affiliations (e.g. CBS/FOX or ABC/NBC), so perhaps there is one that is considered primary? I am not sure. Most stations only have one affiliation,” the exec concluded. After the advent of the station groups, another Wall Street-driven paradigm hit corporate TV executives wanting to eliminate the middlemen (which, in this case was represented by the affiliate TV station and ad agencies) by going directly to the consumer with their streaming services, and in the process negatively affected the affiliates with the networks’ promotion of their own streaming services using the strength of the affiliates’ local TV coverage, and by the networks posting their new network content on their own streaming services, and thus competing with the affiliates. Nonetheless, local TV stations continue to generate income for TV networks, with each viewer worth an estimated $0.23 per hour to the network in ad revenue. (By Dom Serafini) VideoAge WILL GUIDE YOU AT MIPTV
RkJQdWJsaXNoZXIy MTI4OTA5