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They Came, They Saw, They Concurred

Broadcasting: ABC affiliates at the convention were clearly unhappy about last season, but most said the network's plan could turn things around.


LAKE BUENA VISTA, Fla. — After a difficult season in which network ratings plummeted, ABC affiliates don't feel much like champions even though they did go to Disney World.

"It has not been fun," outgoing affiliate board Chairman Andrew Fisher, of Cox Broadcasting, said in opening the annual meeting between affiliates and network representatives here. "This year's ratings weakness cost all of us a lot of money."

That said, most of the 200 stations that form ABC's distribution system seem willing to cut the network considerable slack, citing "a reservoir of goodwill"--as Fisher and others put it--accrued over the years.

Unlike CBS, which alienated its stations during Laurence Tisch's tightfisted run as chairman, ABC has consistently been sensitive to affiliates' needs, station operators note. As a result, this year's convention, which ended Wednesday, focused on efforts to turn the network around, with most station executives feeling that ABC and its corporate parent, Walt Disney Co., have the tools to accomplish the job eventually.

Disney Chairman Michael Eisner sat quietly through much of the two-day presentation. Last year he addressed the group, alongside since-deposed Disney President Michael Ovitz, calling the network's declining ratings merely "some hiccups along the way."

Since then, those "hiccups" turned into a hacking cough: ABC's prime-time viewership dropped 13% during the recently concluded season, leaving the network third in total audience and near parity with Fox for second place in the key demographics that determine advertising rates.

The decline has been reflected in sales for next season, or the so-called upfront market. NBC, owned by General Electric Co., is expected to sell more than $2.1 billion in prime-time advertising when the preseason selling period closes, easily leading that market.

ABC says it will surpass the $1.55 billion sold a year ago, though rivals contend its share dropped below that. CBS (close to $1.3 billion in sales) and Fox (more than $1.1 billion, despite programming a third fewer hours than rivals) also commanded higher prices.

The fledgling WB and UPN networks posted gains, totaling an estimated $150 million and $135 million in sales, respectively. The overall market will exceed $6 billion, up about 5% from a year ago.

ABC saw certain advertisers, such as movie studios, funnel money toward NBC and Fox but claims to have offset those losses in other categories, such as packaged goods. The network also sold more of its inventory now, meaning it may have to give free commercials to advertisers (known as make-goods) to cover rating shortfalls.

"We knew we had to correct [pricing] coming off [last season's] performance," said ABC President of Sales Marvin Goldsmith, who added that the network's continuing appeal to media buyers "shows they have confidence in us."

The revised prime-time lineup features 10 new series, with nearly half the schedule changing. Competitors say such a drastic overhaul historically hasn't worked, but ABC executives maintain offering unproven fare provides more chances to find new hits.

Fielding questions from affiliates, Eisner said he is more optimistic than a year ago about ABC's prospects. The executive said the merger has been "very comfortable and smooth" and that ABC is worth more now than the $19-billion acquisition price, suggesting Disney "underpaid."

Most affiliates echoed the sentiment that a few successes can trigger a recovery.

"I am more enthused than I thought I'd be, and I'm a tough critic," Stephen Kimatian, general manager of WIXT in Syracuse, N.Y., said after the prime-time presentation.

"It's a significant rebuilding process, but I think over time we will turn the tide," said Cathy Creany, senior vice president at ABC-station owner Belo Broadcasting.

Perhaps more than anything ABC executives said or did, the venue itself reinforced the feeling there is reason for hope. Station executives and their families were treated to free run of the Disney World theme parks as well as an advance screening of the studio's latest animated movie, "Hercules."

"The ingredients are here," said Freedom Broadcasting President Alan Bell, whose company owns both ABC and CBS stations. "They just have to figure out how to put the pieces together."

Affiliates were also reassured to hear that ABC Inc. President Robert Iger--who once headed ABC Entertainment--will take a more active role in that division, freed from certain management responsibilities by the addition of News Corp. executive Preston Padden as president of the network.

In his introductory remarks, Iger quoted former Capital Cities/ABC Chairman Tom Murphy, saying, "The real test for managers comes when times get tough, so I guess now is our test time."

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