WHDH’s Fight To Keep NBC Boston Affiliation

After NBC informed Ed Ansin last September that it was not going to renew its affiliation agreement for his WHDH Boston and would, instead, launch its own station in the market, the combative Ansin threatened legal action to block the move.

Two weeks ago, Ansin made good on that promise, alleging in a Boston federal court that NBC was bypassing its affiliate in violation of an agreement that NBC parent Comcast agreed to in 2010 to win government approval of its acquisition of the network.

According to the 55-page complaint, “Comcast violated its obligations under the affiliate agreement to maintain a cooperative dialogue with WHDH regarding renewal of WHDH’s affiliation relationship, to negotiate and renew the existing affiliation agreement in a manner that sustains the community’s free, over-the-air access to NBC programming, to prevent its cable interests from influencing its affiliation negotiations, and to refrain from migrating major sporting events to Comcast owned channels.”

In announcing two months ago that it would launch its “12th NBC station” in Boston on Jan. 1, 2017, the day after WHDH’s affiliation expires, NBCUniversal Owned Television Stations President Valari Staab said the new station would be built upon NECN, its regional cable news network, which has been strengthened by a “very significant investment” over the past two years.

Despite the cable news foundation, she stressed, “the new NBC-owned station will be a broadcast channel,” but conceded that NBC had not yet settled on an over-the-air outlet. NBC is “currently looking at a variety of options,” she said.

NBC has other resources in Boston that its station will be able to draw upon, including Telemundo O&O WNEU (one of the possible NBC broadcast options); Comcast Cable, which serves 85% of the market’s cable subs; and Comcast Spotlight Boston, the market’s cable ad interconnect.

NBC is not commenting on the suit beyond a statement that characterized it as “meritless” and “baseless.”

Ansin has been in broadcasting for 54 years. In addition to WHDH, he owns its companion station, CW affiliate WLVI, and WSVN, the Fox affiliate in Miami. WSVN once experienced the same trouble WHDH is. In 1988, NBC yanked WSVN’s affiliation after purchasing WTVJ there. That turned out OK for Ansin as he was able to sign on with Fox in its early days and share in its subsequent growth and success.

As the legal proceedings begin to grind forward in Boston, Ansin spoke to TVNewsCheck Editor Harry A. Jessell about the his determination to hang on the affiliation and why his suit is anything but “baseless.”

An edited transcript:

So what are you hoping to achieve with your lawsuit?

Well, the first thing we are requesting is an injunction that would preserve the status quo for the life of the litigation. The NBC contract expires at the end of the year, and we anticipate that we will be in litigation past that.

But the ultimate goal is to get the affiliation back, right?

Well, that’s the ultimate goal, yes. Or, if the court is not amenable to that, damages.

Do you anticipate the NBC affiliate group coming to support you?

No. They are certainly supportive, but we haven’t ask them to participate in the lawsuit.

The complaint says that you never negotiated seriously with NBC about a renewal.

No. We had, for a couple of years, from time to time, said to them, “Well, we would like to talk with you about renewing, and each time they said, “No, no, we are not ready to do that. The contract expires in ’17.  We won’t be ready until the year prior, 2016.” So, we never had any conversation. Then, one day in September, two emissaries from NBC showed up in our office and tell us that they are not renewing.

And those emissaries were Ted Harbert [chairman of NBC Broadcasting] and Jean Dietze [NBC president of affiliate relations]?

Yes, exactly.

Well, at least they did it in person instead of just sending you a text.

It didn’t make me feel any better, but I guess.

The complaint says the you repeatedly received assurances from NBC that your affiliation would be renewed.

Totally, going back to at least 2014 and perhaps earlier, we kept hearing…that [NECN] was telling people that they were going to be the NBC station when our contract expired in 2017. We went down to see them in New York and we said, “Look, NECN keeps telling people this,” and they said, “No, no. That’s not the case.” We said, “You’ve got to tell them to stop,” and they said, “Oh, yeah, we’ll tell them because that’s not the case.'”

I made them a proposal anyway.

So there was never any discussion about reverse comp?

No. We never discussed it at all.

But you assumed that you would have to pay reverse comp.

When I gave them that proposal, it included sharing our retransmission [consent] money.

Do you think this has anything to do with your being a burr under NBC’s saddle?

Absolutely not, and I’ll tell you why. I have been an NBC affiliate for 47 years, believe it or not — 26 in Miami and 21 in Boston. The only disagreement I had in 47 years with NBC was when [in 2009] I got into an argument with [then NBCUniversal CEO] Jeff Zucker about moving Jay Leno into 10 o’clock. I said to the network, “That’s a terrible idea; it’s not going to work for us. How about giving us a delay on the show. We would like to run news at 10 and Leno at 11.” Well, one day I get a call from Zucker, telling me he doesn’t care what our contract says and he is climbing all over me…. A couple weeks went by and I said, I better acquiesce and so I did. We carried Leno at 10 and the show didn’t work.

And otherwise you have had a good relationship?

Yes. We clear everything, we cooperate on everything, [NBC News] loves us because we have a great news department. We are the highest rated NBC affiliate in the top 10 markets.

So, why do you think they are doing this?

Their motivation is very clear to us. In fact, they told us what their motivation is because we said to them a number of times, “Look, this is crazy.  We are the top-rated NBC station. For you to not renew with us and to open up a station from scratch doesn’t make any sense. Nobody in the history of television ever considered doing that.”

The NBC network is going to end up having a dark hole in Boston. That’s crazy. NBC had a similar situation in 1994 when CBS bought WBZ, which had been their historic affiliate.  They needed another station and we had been talking to Fox at the time and NBC desperately wanted to affiliate themselves with us because they realized that they didn’t have another good option in Boston. They were very generous in terms of compensating us.  We ended up with a contract that went on for 21 years.

But what was the reason they gave for breaking up the partnership?

They said the reason is because of the scope of the properties that Comcast owns in Boston.  They own regular cable news [NECN]; they own Comcast the Sports Network, which has the Celtics; they own the Telemundo station [WNEU]; they own the interconnect in Boston that sells all the spot cable.

That sounds like a legitimate reason, doesn’t it?  They have all these assets there. They have a newsroom there. Why not leverage that?

Yes, but that is something that they were not supposed to do under the contract between Comcast and the affiliates which dates back to 2010 when they needed the affiliates’ support for Comcast to buy NBCU.  They signed an agreement with the affiliates and one of the things that was prohibited in the agreement is NBC cannot negotiate a deal that reduces the strength of the network for the benefit of Comcast.

But that’s not the only thing they are doing wrong.  They are also violating the public interest by coming up with a station that covers only half of the market. They have announced that they are going to broadcast from their Telemundo station, which they own in New Hampshire outside of Manchester.

I checked that, and NBC says they haven’t announced that yet. They just say that WNEU is one of several options.

Here’s the story: NBC tried to buy a better facility prior to the quiet period and they were not able to do so. For one thing, they were not offering nearly enough money. What we kept hearing was they were offering less than $100 million and the published FCC [inventive auction opening bid] prices for stations in the market was between $400 million and $540 million. [Editor’s note: During the FCC’s quiet period — before and during the upcoming incentive auction — broadcasters are not allowed to privately or publicly discuss their intentions in regard to the auction. The FCC has also said it will not process applications for station sales during the period.]

So, in the middle of November [2015] when we met with them again, I said, “Here is something I don’t understand: I know you haven’t had any success buying another facility. What’s going to happen on Jan. 1, 2017, when our contract expires, how are you going to broadcast,” and they said, “Oh, we are going to broadcast on WNEU and hope to buy a better facility after the quiet period.”

That may be wishful thinking. There may not be much left in the market after the auction.

That’s what I said. Or, they may still not be willing to pay the price.

Among the stations they have offered to buy is WHDH, right?

They didn’t try to buy the station. They wanted to buy the part of the station that broadcasts the signal — the broadcast facilities.

Oh, they didn’t want the newsroom and studio.

Yes, exactly because they are planning to set up a newsroom at NECN. Now that is prohibited in the contract because they are prohibited from putting themselves on cable. The combination of moving to NECN and moving to a New Hampshire station covering half the market is a violation of the contract I referred to earlier.

Alright so what did they offer you for WHDH’s broadcast facility?

Two hundred million dollars.      

And you turned them down?

They were trying to steal it.  They had the nerve to say, “Oh you are not going to have an affiliation anymore and we would like to buy it for $200 million.”

What do you think it’s worth as an NBC affiliate?

In excess of $500 million, probably closer to $600 million as an affiliate.

Is the $200 million still on the table?  I mean do you think you could still do that deal if you wanted to?

I told them we weren’t interested.  We can’t do it now anyway. The quiet period has started.

According to your complaint, NBC also offered to pay you $75 million to channel share WHDH.

I’m trying to think what I can say under the quiet period….Fundamentally, it’s a worse offer than the first one. Let me just say that.

Did they tried to buy the station before the affiliation renewal became an issue?

They came to me a couple of years prior to 2014 and wanted to know if it was for sale and I said, “No, it really isn’t.” That was the whole gist of the conversation.

Why don’t you sell WLVI, your CW affiliate in Boston.

I can’t talk to you about that because of the quiet period.

Let’s say you fail at the FCC, do you think WHDH can survive as an independent, a news oriented independent there?

Yeah, I do.

Why do you think so? Seems like a tall order to me.

Are you familiar with WJXT in Jacksonville?

Yeah. That was the old Post-Newsweek Station that years ago gave up its CBS affiliation over a dispute over comp.

Well, it’s still a Graham [formerly Post-Newsweek] station and they are very successful essentially doing what we would be doing. They are a news-intensive station and they are still the market leader.

They may be the market leader in news, but are they generating as much cash flow as they would have if they had kept the CBS affiliation.

I can’t tell you that, but I know it’s very successful.

What do you think your chances are in the court?

I think are chances are very good. I think they have done a lot of things wrong.

How are you and Fox getting along in Miami [where Ansin owns Fox affiliate WSVN]?

Oh, we are getting along just fine.

When is that deal up for renewal?

That is up for renewal this year.

And you expect to renew that?

Yeah, I do.