JD Lasica’s New Media Musings put me onto a story about FOX affiliate KHON in Honolulu, where the station’s news anchor went on a bit of a tirade on air about the massive layoffs the station’s new owner is implementing.
In particular, he revealed the new owner to be nothing more than the equivalent of a TV station day-trader, telling viewers:
The new owners have changed the name of their company from SJL to Montecito. It is a virtual company, with no office building, that specializes in buying and selling TV stations. Their business plan for KHON2 calls for an immediate, drastic, across the board reduction of personnel in order to slash the payroll.
At the same time, the plan calls for a huge increase in advertising revenue to be generated by a sales department that is already far exceeding industry standards. In short, it is not a plan used by a quality broadcast company to foster a long-term commitment to its employees, or to the viewers it is charged with serving.
The new owner apparently didn’t take kindly to be called a “virtual company,” according to the the local paper:
“What was said last night was not the truth,” said Sandy Benton, chief operating officer for Montecito Broadcast Group LLC, which has changed its name from SJL Acquisition LLC. …
Benton said there is a home office. “Of course there is. It’s in Montecito (Calif.),” she said. …
Benton countered, “We have every intention of serving the community to the same degree it has been served in the past. If somebody had asked, we would have told them that. In fact, we did tell them that.”
This is an extreme version of what companies like Nexstar and Sinclair are up to — buying up stations and draining their revenues to fund additional station purchases and fatten executive wallets. I’d include shareholders as fattening recipients, but these companies aren’t generally doing so well on the stock market.