MAKING TV'S FUTURE WITH TV'S PAST

For several years, broadcasters have been casting about for a way to turn the extra capacity in their digital channels—the bits left over after broadcasting their main service in HD—into a money-making business.

Over the past several months, a growing number have landed on Retro Television Network, a network with the look of an old fashioned independent TV station produced by Equity Media Holdings, a publicly traded group broadcaster based in Little Rock, Ark.

Allbritton, Barrington, Cox, Capitol, Media General, Raycom, Scripps, Young and others have signed on one or more stations as affiliates.

Combined with 13 Equity-owned stations, the affiliates are quickly turning RTN into a bona fide national network.

The network now counts outlets in 44 markets, including nine of the top 25—San Francisco, Atlanta, Detroit, Phoenix, Seattle, Denver, St. Louis, Pittsburgh and Charlotte.

Its total TV household coverage is approaching 26 percent.

RTN expects those figures to rise steadily as it aggressively hunts for additional affiliates.

Indeed, hardly a week goes by now that one of the current affiliated station groups doesn’t chip in another station or another group signs on. Last week, it was Media General bringing WVTM Birmingham, Ala., its sixth station, into the fold.

One reason RTN may be having such early success its ability to customize the network for each affiliate by inserting not only local commercials, but also local programming and syndicated programming for which the station has the local rights.

Another reason may be the simplicity of the affiliate deal. RTN provides 16 hours (10 a.m.-2 a.m.) of vintage programming every day (and occasional national sports) and evenly splits the approximately 12 minutes of commercial time each hour with the affiliates.

On Saturday morning, RTN offers an optional three-hour block of children’s educational programming that it says meets the FCC’s mandate.

RTN also acts as master control of the affiliates, integrating whatever local or syndicated programming the affiliates send upstream and sending it all back to the stations ready for air.

In addition to half the commercial time, RTN hangs on to the overnight hours (2 a.m. to 10 a.m.) for paid advertisers, and charges a “nominal” monthly technical servicing fee.

Charged with growing the affiliate lineup is Executive Vice President Mark Dvornik, a former syndication executive who knows the programming as well as his customers.

In this interview with TVNEWSDAY Editor Harry A. Jessell, Dvornik tells why he believes RTN is broadcasting's answer to the digital challenge and why he believes he can stretch the RTN’s footprint to 80 percent of the country by this time next year.

An edited transcript follows:

As I look at your channel lineup, I am looking into my TV past—I Love Lucy, The Fugitive, Happy Days, Hawaii Five-O, Mission Impossible. What’s so unique and compelling about that?

What’s unique is that we are 100 percent focused on the localization of our network. Each feed that we put into a market is unique. We are embracing localization.

Now, an affiliate comes to me and says, "Mark, we want to do a high school football game." Great. "Mark we want to pick up the MAC Conference show and put it on the weekend." Great. "We want to cover this parade." Great. How can we help? How can we support you in what you’re doing?

All of a sudden it’s a win-win. We’re not fighting them. We’re helping them. And we know we’re helping ourselves with the viewers because they’re getting everything they want.

The other thing that we’re really committed to is not repeating shows. So Monday through Friday, on any given day, we air a show only once.

Why that’s powerful is because cable is repeating all the time. Take a look at all the cable channels and how many repeats they’re doing back to back to back even in primetime and from morning to night. Not one of our shows will repeat.

Some of our shows may not repeat in an entire year. They used to do a lot of episodes. There are 255 episodes of Happy Days, there are 255 episodes of M*A*S*H, there are 249 episodes of Andy Griffith. There are so many episodes that if we air them once a day, Monday through Friday—that’s 265 runs in a year—you can almost go one year unrepeated.

We are also providing news and weather updates at the top of every hour.

You announced earlier this year a big deal with CBS for its library of TV shows, actually a library of libraries.

It’s something like 10 studios rolled into one. It is a vast and amazing library.

Do you have deals with the other studios, other big syndicators?

As you can see from the schedules in various RTN markets, we have complemented the CBS programming with hits from NBC Universal, Sony, Stephen J. Cannell and more.

You mentioned that you do local news and weather. How does that work?

A station can do it themselves with its talent and we can put that into their feed. But they can also let us do it. We actually have talent to cut and do some weather breaks on the top of the hour and they can tap into it as much as they want.

So this is sort of like the old radio model. You come in with five minutes at the top of every hour.

It’s just 30 seconds—25 seconds with a five-second sponsorship. It’s another way that they can monetize the network. You know, news sells. If they want us to do it, we’ll use their graphics.

Your goal is to do 210 markets, I presume. How long is it going to take you to get there?

Yes, our goal is to do over 200 markets. What we have said to the Street is that it’s moving much faster than we anticipated and I would imagine that we’re going to achieve our goals a lot quicker than we had planned.

A year from now you’ll see us with more than100 affiliates.

I assume that it will be a while before you are selling national advertising.

Until we get a national footprint, we’re not flying on a national basis. I would say a year from now, you’ll see us with a national footprint of more than 80 percent and we’ll be off and running.

How do you sustain this thing in the meantime? Where are the revenues coming from for the next year?

From our ability to successfully monetize our inventory, which we are very successful at doing.

Monetizing your inventory. Do you mean the overnight infomercials?

Yes. The paid overnight has been very successful for us and we have really good controls over what we’re doing besides.

By the way, there’s no objectionable content with what we’re doing overnight. You won’t see any salacious content. You won’t see any 900-numbers or Girls Gone Wild. Obviously, our content has to be acceptable to the broadcasters.

The affiliates’ ability to monetize this is going to be based on their ability to get cable carriage since few viewers are receiving digital signals over the air. Isn’t that right?

The stations that we’re partnering with have carriage. One of our conditions is that they have to have carriage. Obviously, in our digital future, people will have the ability to see this, but stations have to have cable carriage.

As an old syndication man, you know you need a big market station launch group. What’s the plan to crack the top 10 markets?

We are already in San Francisco [Young’s KRON] and Atlanta [Cox’s WSB] and we will see more broadcast groups step up. Yes, we do have a plan to be in all the top 10 markets. We do have a plan to be in all the top 20 markets. We do have a plan to be in all the top 100 markets. A lot of discussions are going on, which I cannot comment on, as I’m sure you can appreciate.

One key to the big markets is the new Tribune/Local TV super group. Have you had any discussion with [Tribune/Local TVs] Randy Michaels?

I’m not going to comment on the record on any of the discussions we’ve had with anybody because I don’t want to play that out in the press. But we’re very excited by all the group discussions that are happening.

We see January as a very busy month for us. We are going to have a big presence at NATPE. We have a fantastic dinner planned on Monday night co-hosted by Robin Leach.

Since each lineup is customized with local programming and commercials, how do the affiliates manage their schedules?

We set each station up with its own OSI account separate from any account that it may already have. The stations have access to it 24 hours a day. They log into that and click and drag all their spots, PSAs and promos in there, plus trafficking instructions.

Then we do all the insertions on our end and they can print their logs 24 hours a day and print out local billing. But we are master control. When they get it, their feed is complete.

Down the line, we may also offer WideOrbit, but right now we’ve done everything with OSI. I want to be careful what I say in the press because I don’t want it to look like we’re negotiating with OSI or WideOrbit, but you could hear in the next month or two that WideOrbit comes in and stations have a choice of OSI or WideOrbit.

Are you planning any kind of affiliate meeting?

We’re going to have a digital sales summit this June in Dallas. We’re encouraging every single station to send at least one sales person.

It’s going to be a full-blown meeting on the fundamentals of selling digital and selling locally with plenty of success stories. And every single one of the people who are invited will have something to take back—a manual and the success stories.

This is part of our commitment, a way of saying to broadcasters, hey, we want you to be very successful, we’re here to help you, we’re going to help train your people. We’re excited about that. I see this being either an annual or semiannual thing that we do.

So essentially you’re back to doing what you’ve always done, which is looking for outlets for your programming, making the rounds around the country.

Yes. I am enjoying continuing the relationships that I forged over the years with broadcasters and helping them transition to the digital era.

I love to entertain America. There’s no better way to entertain them than with our Prime Time All The Time Lineup, which is the best shows that Hollywood had to offer and have stood the test of time.

But your job is not to entertain America. It’s to entertain broadcasters and get them to sign on the dotted line.

This opportunity is so clear-cut that I think everybody, when they sit down and they analyze it, will see the value of it. I don’t really see it as selling. I see it as providing information they need to make a decision on a station-by-station basis.

It’s actionable because it currently can make them money and there aren’t a lot of propositions like that out there and there is nobody offering to customize each feed. It is a powerful alternative.