"Nowadays, national TV stations are mainly divided into two types. One is the traditional wireless station, CBS, NBC, ABC, and the youngest Fox. The other is developed after the passage of the 'Cable Communications Policy Act' in 1984.
The national cable television networks that came out, such as CNN, MTV, ESPN, etc.”
DDH CEO Ed Bastian, who made a special trip to Los Angeles to discuss Eisner's possible acquisition targets with Ronald, gave Ronald a table.
"Which one is he most likely to buy?" Ronald looked at the names of the four wireless stations above. The first three are all established TV networks with deep roots. Fox is owned by the Australian rich Rupert. It doesn't matter.
None of them seemed easy for Eisner to buy.
Among the cable TV networks, only news stations like CNN can provide Disney with the resources it needs. However, his boss Ted Turner, Jane Fonda’s new husband, is not someone willing to sell the company he founded.
company people.
"I don't think any of them are possible..." Ed Bastian was much more familiar with the situation of these TV networks. He told Ronald about the holding status of these TV stations.
NBC is controlled by General Electric, and their CEO Jack Welch is also a man with a flamboyant personality. He was named the best CEO in the United States and will never give up his controlling interest.
If CBS and ABC are acquired, it will be a sky-high acquisition that can be compared with Paramount. Disney has to use financial leverage like Redstone to make acquisition decisions, which is not an easy task at any time. Moreover,
Disney's shareholder situation is much more complicated than Redstone's Viacom. Eisner has to be prepared for sneak attacks from behind if he wants to make any moves.
"I think it is more reasonable to acquire Warner Bros. Television Network. They are smaller than the major television networks, but with Disney's money, they can quickly expand to catch up with the scale of Fox.
Or negotiate with Redstone and take advantage of Viacom's cash crisis to buy Paramount Television Network. It just so happens that the TV audience of this television network is mainly teenagers, which is consistent with Disney's positioning..."
"Um……"
Ronald nodded, then shook his head. He understood that Bastian considered Disney's possible acquisition targets through rational business logic. But Eisner's biggest problem was not this...
After Disney lost its most capable COO Katzenberg in the past few years, the stock valuation has been greatly affected. After all, it is obvious to all that both animation and live-action movies have restored their box office capabilities under his account.
of.
What Eisner fears most is not the trivial matter that the acquisition is uneconomical, but that shareholders will unite against him and knock him out of the chairman's chair.
Launching a large acquisition can not only satisfy the performance requirements of certain shareholders who support him (such as the Bass family), but can also use it to suppress opponents (such as Disney's nephew). The larger the acquisition, the more thrilling it is.
The more you can use your strength to please the former and suppress the latter.
As for centrists like Ronald, they are even more locked in place. They dare not do anything to join forces, support or oppose things. They can only vote obediently at the shareholders' meeting, the only place where they have a sense of presence.
Support Eisner.
"What Eisner will face is another battlefield. I think he is likely to attack ABC or CBS, but NBC is unlikely to do so." Ronald's view is reasonable, Jack Weir
Qi, he is the same type of person as Redstone and Eisner, and they cannot coexist in the same company.
The scale of Warner Television Network is too small to achieve the purpose of using foreign enemies to suppress internal forces. Paramount Television Network, it is not that Redstone cannot see the benefits of the television network, before exhausting the last bullet in his hand
, would never let go of Eisner.
"Well, your judgments about them are often more reliable. I fully understand it from the previous Viacom incident." Ed Bastian pushed up his glasses, "What benefits can we take from this?
, is what matters. Just like in the Viacom acquisition."
"The most I can do is sell the stock while Disney's stock price rises. But speaking of benefits, is it possible for our DDH to acquire a national television network?" Speaking of realizing the importance of television networks, Ronald also saw
Here we are. It’s just that the national television networks are all big players, and their strength is still not as strong as any of the three major wireless television stations, plus Fox and CNN.
"Warner Television Network?" Ed Bastian did a quick calculation. With DDH's strength, it could only acquire the next two small-scale ones. Paramount is a youth network and does not meet the requirements. Now in the market
The only interstate television network that exists is Warner.
"Warner? Impossible. They hate me so much now. Even if they didn't have the huge financial support that Time Group brought to them after the merger, they wouldn't come to me if they wanted to sell."
Ronald himself understood that regardless of what had happened before, after grabbing the filming rights for Forrest Gump from Warner Bros., their senior management and the Imperial family in New York were now very resentful of Ronald. A man who might remain in history
The opportunity to win the statuette was snatched away right under his nose by him, Shirley Lansing and others.
"Then there are no suitable cross-regional TV networks on the market now. The rest are various local TV stations scattered in all 50 states in the United States..." Ed Bastian closed the folder.
He pressed his hands on it, as if there were some treasures inside, and at the same time looked at Ronald with bright eyes.
"It's still less money. It's too late for me to make a fortune. If Dirty Dancing could have been filmed five years earlier, no, three years ago, my current assets may have doubled." Ronald also smacked his lips,
It's a pity.
A national television network is not something that can be built just because you want it. The ones we have now were created by the super rich who spent a lot of money, or they started in the 1950s and have developed over a long period of time.
came.
The FCC has issued only a few national television licenses. Either you spend tens of billions to rebuild one, or you spend money to acquire the equity of an existing television network.
Seeing everyone occupying the pits one by one, Ronald was a little envious of migrant workers like Eisner. When they entered the company, the company was already a very large enterprise. Although they did not belong to them, they could borrow
This platform mobilizes huge amounts of resources.
Although most of DDH belongs to itself, it does not have such a platform to borrow from to exert its strength.
"Huh?" Ronald sighed and was about to give up. But he picked up the small cup and drank black tea, and suddenly discovered the meaning in Ed's piercing eyes.
"Come on, have a cup of this black tea. I didn't know how to make it before, but Yang Yanzi taught me to use a small cup so that I can enjoy the full flavor of Wuyishan Lapsang Black Tea..." There is another one on Ronald's table.
The tea set for Kung Fu Tea, this is Ang
Mr. Qiu of Lee's hometown, Times Group, gave it to him. It was just right to go with the black tea sent from the mainland. Unfortunately, Ronald had put it as a decoration in the office before. Yang Yanzi was knowledgeable and corrected him from drinking black tea from a mug.
A wasteful practice.
"Well..." Ed Bastian took the small cup handed over by the boss himself and put it to his mouth. The rich aroma lingered under his nose, and the thick tea soup gave off a beautiful amber-like aroma.
The color, after one sip, the aroma and taste mix and roll in the mouth, making people very comfortable, as if the whole person has entered a kind of "Zen" feeling.
To be honest, Ed Bastian has also tasted Japanese tea ceremonies, but he has never had such a refreshing and Zen-like experience.
"The small cup has this advantage. If you put the big cup to your mouth, you won't smell those flavors." Ronald smiled and added a cup to him. The small teapot can also control the temperature better to achieve the best brewing.
Soak temperature.
Ronald stared at Ed Bastian, but he still pressed his other hand on the folder. There must be good things and good plans in it.
"Come on, have another cup..." Ronald was not in a hurry, just served his subordinates, brewed a cup of tea into the teapot, and then quickly poured it into another large teacup, and finally changed it into a small teacup.
The movements are smooth and flowing...
"That's enough for me. This is really a process that inspires people's wisdom..." Ed Bastian also felt that it was almost done and opened his folder. "The wisdom of black tea is to use a small cup. We also have another one.
Choose, do magic in the small market..."
Speaking of which, the main reason why there are so few national television networks is because the antitrust law gives the FCC the power to review all wireless television stations. There are still many legislators who want to take advantage of the fact that the programs of cable TV stations contain more violence and romance.
Put them under FCC regulation as well.
The most important piece of FCC regulation is the so-called anti-duopoly provision.
Under this clause, a company cannot invest in two national TV stations at the same time and become a shareholder of both parties. It is said that this is to allow major TV stations to have an independent voice, prevent excessive concentration of media control, and ensure competition; it is conducive to
Viewpoint Diversity and the Public Interest.
Under this clause, each major media group can only obtain ownership of one national television network. To a certain extent, competition in this industry is retained, even excessive competition.
Many times, there is not much difference in the news between NBC and CBS, or between CNN and ABC, and there is not much difference in the flagship programs.
For example, the late show hosted by Ronald's good friend David Letterman on CBS and the late show hosted by NBC's old employer have similar audiences and the same purpose of the program.
However, national programs cannot cover all program periods. The so-called national television networks, such as NBC, also have local television stations across the country. Except for a few key areas, such as New York, they are directly operated by NBC.
Besides, most other places cooperate with local TV stations.
Ace programs and important news are broadcast nationwide, but local news, weather forecasts, local sports competitions, and other time periods are compiled and broadcast by local TV stations themselves. These local TV stations are the ones most watched by American viewers.
channel.
Similarly, in order to protect media competition and allow local people's voices to be heard on television media, the FCC divided the country's viewing areas into 210 Designated Market Areas (DMA).
This is a region divided by the Nielsen Ratings Research Company. Each region has a different number of viewers, ranging from millions in the New York DMA to tens of thousands of viewers in the Alaska DMA. In each DMA region, viewers watch a set of weather forecasts.
program, as well as its own local news.
In order to protect the freedom of these DMAs, and to give the FCC department more legitimacy, strive for more federal budgets, and strive for greater regulatory power, the FCC also has a famous antitrust clause for DMAs, which is "
The two-station rule”.
A company can only control two TV stations in a DMA. Among the two controlled stations, only one can be NBC, ABC, CBS and Fox, which are among the top four ratings in the United States. The other one can be the one at the bottom.
Real local television.
But when crossing DMA areas, the FCC does not prohibit you from acquiring more local TV stations.
This chapter is not over, please click on the next page to continue reading! For example, Ronald's DDH has a TV station in Manhattan that has a broadcast agreement with NBC, but there can be another TV station on Long Island that has a broadcast agreement with ABC. Here we go
On Staten Island, he has another TV station that has a broadcast agreement with Fox, and these three stations all have broadcast agreements with PBS, where Helen's father is the general manager, because PBS's ratings are very low, and this is all legal.
allowed.
"So your plan is to acquire these local TV stations to form a national TV network?" Ronald was puzzled. This ordinary plan is not a surprise. Why did Ed Bass
Tian seems to have a special trick.
The prices of these TV stations are not low. After all, they have been entrenched in the local area for many years and have loyal advertising customers. But because of this, there is not much room for revenue growth. The acquisition price is also fixed, and you spent a lot of money to buy it.
It may take a long time to recover the investment, and the return on investment will not be very good.
"Yes, it is time to legislate the supervision of cable TV stations. There is a very loud voice now, which is the so-called Must-Carry Rules."
Ed Bastian finally smiled like a hunter catching his prey.
"Required rules?" Ronald found the analysis part from Ed's file directory. This is a future rule for cable television networks. That is to say, cable television systems operating locally must rebroadcast local broadcasts to viewers for free.
Radio and television signals.
Cable TV networks are all national, and the content compiled by a production team is broadcast nationwide. But like weather forecasts and local news, these contents are needed by local audiences, but TV stations like CNN cannot produce them. They cannot support the whole country.
210 editorial teams.
Originally, viewers of these TV networks could tune into wireless TV and use antennas to watch local programs. However, the legislation the FCC wants to promote is that local cable TV providers must provide content produced by these wireless TV stations, including
On the channel, it must be broadcast to the audience for free on the first 30 channels.
The so-called must-bring rule is that you must bring local news, weather forecasts, traffic conditions and other public welfare programs. Free broadcasting means that it is free for viewers, but the content must be purchased from local TV stations.
This local TV station has brought in two huge amounts of revenue. The first is the licensing fee for the cable TV network to purchase program content from them. The second is the increase in advertising prices after the cable TV network has increased its broadcasting population. Now local TV
The show can now be seen by a wider cable TV audience.
All of this is brought about by the two rules defined by the antitrust law and the mandatory rules in the new bill if it can be successfully passed by Congress.
At present, everyone does not know much about this, so in comparison, the current price of large-scale acquisition of local TV stations is very cheap.
"So we have to speed up the acquisition of local TV stations in various places." Ronald nodded. DDH has already bought several local TV stations from Viacom, as well as the New York regional TV station that Daily News Group acquired in advance. Now if we start a large-scale
Through acquisition, it is possible that before the bill is passed, the number of TV stations controlled will be increased to more than 100, and programs will be broadcast in 100 DMAs across the country.
"Not only that, we can also use the Joint Sales Agreement (JSA) and the Shared Services Agreement (SSA) to bypass the two-machine rule..."
Ed Bastian dropped another bombshell. Many of the 210 DMAs are actually tasteless garbage areas. The real profits are generated by the more than 110 DMAs with relatively dense populations. These places
It is also restricted by the two-station rule and cannot occupy more shares.
But Ed Bastian discovered two methods from directly operated television stations in New York that could circumvent the restrictions of the two-station rule.
JSA is a group of several local TV stations that unite to submit quotations to advertising agencies. If you want to invest in advertising, you should jointly invest in the top eight local TV stations and sign an agreement with two or three of them. This can save advertisers a lot of money.
trouble, thus increasing the advertising revenue of each TV station.
As for SSA, when purchasing TV programs, several TV stations jointly purchase them to reduce costs. For a TV series or a documentary, several TV stations can jointly purchase them, and they can often obtain an average lower cost.
These two agreements not only allow TV stations to reduce costs and increase efficiency, but can also be used to lock TV stations from both ends and actually control their TV stations without holding a controlling stake. Your income and procurement costs are both controlled by both parties.
The protocol is locked, and if you break away, you are likely to lose in the competition.
"So, our main point is to make large-scale acquisitions this year and next, sign more JSAs and SSAs, and ensure that the necessary rules are passed into law in congressional legislation, and that JSAs and SSAs are not regarded as de facto holdings?"
"That's it. We have a once-in-30-year opportunity to become an organization as influential as several national TV networks at a very low cost. A seemingly inconspicuous local wireless station..."
Ronald laughed, and he also understood why Ed Bastian needed to use the platform of DDH to display his ambitions. And only he, the boss, had the influence in politics to ensure that both parties
an important clause.
"Our path is completely given by the antitrust law passed by members of Congress..." Bastian commented that it is not a two-channel rule, but a must-have rule. This market opportunity will not appear. Big TV
The Internet has long since wiped out the oily DMA.
"I love antitrust laws..." Ronald smiled and poured tea for Ed again, and then served refreshments made with Italian sausage.
It seems that it is time to receive returns for all the donations and favors I have made in the political world.