THE BIG-TIME CHALLENGES OF SMALL MARKETS
Bill Duhamel owns and operates just one TV station, KOTA Rapid City, S.D.
But with the help of three full-power satellite stations, the ABC affiliate covers a lot of ground, reaching 150,000 homes in two sprawling TV markets, Rapid City and Cheyenne, Wyo.-Scottsbluff, Neb. It's equivalent to the area from Washington, D.C., to Boston and Buffalo.
Over the years, Duhamel has covered even more ground though his work on various industry boards, including those of the NAB, the Association for Maximum Service Television, the ABC affiliates, the CBS Radio affiliates and the Rocky Mountain Broadcasters Association.
In addition to KOTA and its three satellites—KHSD, KDGW and KDUH—Duhamel also owns a small cluster of radio stations in the area.
In this interview with TVNEWSDAY Editor Harry A. Jessell, he says he is struggling with the same business issues as his larger-market broadcasting brethren (declining revenue, increasing competition).
And he makes clear his Republican belief in minimal regulation, even though his wife is working for Hillary Clinton in the upcoming South Dakota primary and his former neighbor and family friend is at the forefront of FCC efforts to administer another heavy dose of broadcast rules.
An edited transcript:
So how's business in DMA 175 and DMA 196?
It's fairly tough. The local business is holding up, but the national business is switching almost into a commodity, which is a shame.
How much of your revenue comes from national?
At one time it used to be about a third, but now it's down to probably about 20 percent.
So I guess you would anticipate that getting even smaller in the years ahead?
Yes. I suspect so because a lot of times the agencies don't really seem to be interested in the best interests of their clients. The buyers have got a little formula that they're going to use and they don't pay any attention to reasoning anymore. It's just kind of: this is it, take it or leave it.
But you say local is holding up?
It's holding up very well. The economy hasn't really dipped that much out here. On the other hand, it didn't really boom either. It's pretty stable. If there are any subprime mortgages, they're well hidden because I've never heard of anything. The biggest problem locally that we'd be concerned about is all the negative press about how bad the economy is. It may cause consumers to stop buying, and that affects everybody.
South Dakota has a Democratic primary coming up on June 3. Do you expect any money out of that?
We're getting a little Obama money. Clinton, I think, would like to spend some money, but I think they are strapped. We rarely get much presidential money any year. South Dakota has three electoral votes and you can almost count on them going Republican. Everybody knows that.
So the Obama money is a bonus.
We're not talking about big money. We're talking about a few thousand dollars. It might buy my groceries this week, but it's not going to do a lot more.
What about state or local political money?
So far there hasn't been much. In Wyoming, there's a fellow running for an open seat in Congress and he's spent a little money with us. He's about the only local money that we've seen so far. There might be some local races, but again it's not significant money—not enough to pay the overhead, I'll tell you that.
You bought some radio stations within your market over the last decade or two. Why no TV?
Because of the FCC rules. There are four [commercial] stations here and you can't do duopolies with the top four stations.
If it relaxed that rule, do you think you would buy?
Yes. There would probably only be two owners in the market because it makes more sense, but there's an FCC rule and it would take 10 years to get a waiver through at the speed at which the FCC moves.
Well, you can talk to Commissioner [Jonathan] Adelstein about that. I understand that your families are close?
Yes. His dad lives just across the street from me. He's a good friend of mine. He always has been. In fact, Jonathan, when he was probably in high school, used to come over to the house occasionally and eat dinner with my kids. He ended up at Stanford because my children were there.
I also understand that your wife, Judy, is the chairwoman of the Democratic party in the state?
She was for eight years. She decided last year not to run again. 2006 was her eighth year. My wife is really very big on the Hillary campaign right now. She's very involved in | More …
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