By replacing Wheel of Fortune and Jeopardy with home-grown shows, it will control all of the access ad positions. Plus, it hopes to syndicate Let’s Ask America and The List to non-Scripps stations as well to generate more revenue.
As E.W. Scripps Co. reported strong 2Q results for its TV group, management was also pitching Wall Street analysts on the two new shows set to launch Sept. 17 on many of its stations. Let’s Ask America and The List will eventually air in all 13 Scripps markets and the company has syndication plans as well.
The new daily 30-minute shows, which Scripps announced in May, will replace Wheel of Fortune and Jeopardy when they launch next month. Those are two of the top shows in syndication, but they are also pretty expensive.
Rich Boehne, president-CEO, described the new programming as one way that Scripps is working to “transcend” the political spending cycles. “Bridging the third and fourth quarters of this year is our transition from some very expensive and underperforming syndicated programming to a couple of new home-grown shows. When Wheel of Fortune and Jeopardy leave our air in seven markets on Sept. 17, we will take direct, long-term control of the valuable access timeslots and set a course that could substantially improve our profit margins,” he told analysts and investors today.
“Now, for the record, there’s nothing wrong with Wheel and Jeopardy. I have arrived home from work many an evening over the years and enjoyed a bowl of canned soup while Vanna turned the letters and Alex announced the categories. But that hour is a precious asset, one which we believe can generate much higher long-term returns through a more entrepreneurial approach to programming,” Boehne said, adding that the new shows could even more profitable if they prove successful in syndication to other markets as well.
In the company’s quarterly conference call, Brian Lawlor, SVP-television, was asked what benchmarks Scripps will use to judge the success of the new shows. “I think the benchmarks are really audience. We’ve laid out various models. Obviously having 100% of the inventory versus having roughly 70% gives us some level of flexibility where our ratings could actually go down, but our profitability would go significantly up still — and our revenue would go up,” Lawlor said.
Let’s Ask America is a game show. But rather than having the contestants in the TV studio the four players compete from their homes via Web chat to demonstrate their knowledge of current events. One player is eliminated through each of four rounds of play, with the dollar values for correct answers rising with each round. According to the website for the new show, contestant auditions were conducted earlier this month in Cleveland and Cincinnati.
The List is a nightly news magazine focused on trending stories of the day presented in a list format. The ensemble cast of journalists will include national and local video bloggers, as well as content from the Scripps news service in Washington.
The game show, Let’s Ask America, will launch Sept. 17 on seven Scripps stations: KNXV (ABC) Phoenix; WFTS (ABC) Tampa; WMAR (ABC) Baltimore; KSHB (NBC) Kansas City; WCPO (ABC) Cincinnati; WEWS (ABC) Cleveland; and KJRH (NBC) Tulsa, Okla. Lawlor told analysts that the news magazine, I, will launch on six of those stations and a Scripps spokesman told TVNewsCheck that KSHB Kansas City will not initially air the show because of contractual commitments.
Scripps plans to eventually air both shows in all 13 of its markets once existing syndication contracts expire. If all goes as planned, The List will be offered to other broadcasters next fall.
Warner Bros. Domestic Television Distribution distributes Let’s Ask America, which is produced by Telepictures and paraMedia inc.
As it reported 2Q results, Scripps upped its estimate of 2012 political ad revenue to $52 million, having previously said only that this year would beat the $42 million booked in the 2008 presidential election year.
Olympics-related ad revenues are expected to finish at least 40% ahead of the $4.7 million recorded for the 2008 Beijing Olympics.
In its formal guidance, Scripps told Wall Street that 3Q TV revenues should be up more than 70%. That includes the big boosts from political and Olympics advertising. Excluding the stations recently acquired from McGraw-Hill, the gain is put at more than 30%.
Scripps officials declined to provide details of how the four newly acquired ABC affiliates are performing, leaving analysts to try to back out same-station numbers from the company’s consolidated numbers to try to get a handle on the former McGraw-Hill stations.
Despite having made that $212 million group buy, Scripps isn’t ruling out further acquisitions.
“We look at everything that comes along,” Boehne said. “We don’t pay much attention to where multiples are; we focus on cash-on-cash return on investments when we spend the shareholders’ money. So obviously we haven’t seen any additional deals on top of McGraw-Hill that would satisfy what we think is the return on investment that we need to really make it work.”