Mind The Gap

Written By Tim Hanlon

Last week's observations on local TV stations' FAST channel ad monetization challenges struck a knowing chord with many readers. This week, we shift our focus to the various approaches station owners are attempting with respect to programming those offerings — which are fraught with their own set of issues. Especially for broadcast network affiliates.

While the average viewer would love to have unfettered streaming access to their favorite local broadcast TV stations' full traditional linear signals (and rightly questions why they can't, since those channels are ostensibly available for free over-the-air via an antenna) — the economic incentives and regulatory architecture of today's broadcast industry discourage it.

Despite waning subscriber numbers, pay-TV operators (both traditional ["MVPDs" such as cable, satellite, telco TV, etc.], and digital ["virtual MVPDs" like YouTube TV, Sling, Philo, etc.]), pay local affiliated stations and the national networks that underpin them a pretty penny for carriage across their wires. 

These retransmission (or "retrans") fees constitute the majority of revenue that broadcasters generate (eclipsing ad sales by a wide margin), and ensure that the marquee sports and entertainment programs that networks provide affiliated stations (as well as a broad array of syndicated fare) stay firmly in the restrictive grip of the traditional pay TV linear bundle — consumers' interest in streaming-first (or -only) be damned.

For network-affiliated stations, those constraints greatly limit what they can "pass along" in terms of their own streaming channels. Take away the (majority) hours of linear network and syndicated programming from a station's typical daily broadcast schedule, and all that's really left to offer is locally produced news.  Which, from a streaming perspective, can only go so far.

The average mid-sized-market TV station pumps out 4-5 hours of local newscasts each day — maybe a few more in major markets. Assuming each station live-simulcasts those broadcasts on their streaming channel (a logical extension of audience reach and brand), and repeats all of them at least once (though many stations repeat far more), an outsized gap remains to fill the remaining hours of a daily 24/7 linear stream.

While several brave stations have leaned into creating additional stream-only news programming, the realities of already-stretched newsrooms (and their underpaid staff) will ultimately limit what can be further mined from a newsgathering model rooted in linear broadcast economics.

What awaits, instead, is a major opportunity to creatively reinvent what local station streaming can more broadly offer viewers, far beyond today's repurposed made-for-TV newscasts.  We'll delve more deeply into those possibilities in future columns, but here are a few that are already inventively addressing the local streaming content void:

Local News Live (Gray Television): Gray’s 24/7 streaming national news network (hubbed out of the company's Washington, DC news bureau) provides live coverage from the group’s 113 U.S. markets, and is an obvious centralized way to fill individual station streaming hours with curated local news content from "sister stations" across the country. While other groups are similarly experimenting, LNL's live, linear curation approach is the secret sauce - and it makes for relevant and timely quasi-national viewing when individual station newscasts are "off-air".  

Neighborhood TV (Cox Media Group): Currently airing on CMG station streams in Atlanta and Charlotte (in addition to other distribution outlets), Neighborhood TV is an innovative attempt to efficiently source and report quality news/community information at the suburban town and city neighborhood level — arguably a blueprint for what local TV "station" news needs to evolve to. Interestingly, Neighborhood TV not only fills time in CMG station streaming schedules, but also serves as hyper-local content for traditional "local" newscasts as well.     

Very Local (Hearst Television): Perhaps the most aggressive station group embrace of beyond-newscast streaming content is Hearst's "Very Local" franchise, which smartly helps stations differentiate their streaming product from their legacy TV signals with distinct sub-branding and a high-quality production library of "local" series (not just individual stories) that have broad destination-worthy appeal beyond the markets from where they emanate.

Local News To Peruse

Tim Hanlon

Tim Hanlon is the Founder & CEO of the Chicago-based Vertere Group, LLC – a boutique strategic consulting and advisory firm focused on helping today’s most forward-leaning media companies, brands, entrepreneurs, and investors benefit from rapidly changing technological advances in marketing, media and consumer communications.

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