“The whole media landscape is being restructured,” says Ken Hartnett, executive editor of Channel 5 news and a Phoenix contributor (once executive editor of the Hearst-owned Herald, he’s now about to become a Hearst employee again). “The fallout from this will be enormous,” says Hartnett. “There must be enormous pressure to sell over at Channel 7. And how long will it be before the Taylors get an offer to sell the Globe that can’t be refused?”
The sad message here is that such astounding price tags tend to move TV stations out of the financial reach of local buyers with serious commitments to their communities. Channel 7 is locally owned as a result of New England Television’s 13-year FCC battle to wrest the station from RKO General, its unfeeling absentee landlord. David Mugar, chairman of the board of New England Television, continues to insist that the new, and supposedly improved, Channel 7 is not for sale, despite persistent rumors to the contrary.
Not long ago, onetime Channel 5 general manager Robert Bennett, more recently one of the Metromedia execs who created the company’s enormous debt, was issuing similar denials regarding Channel 5. “Once the leverage buy-out took place and we took the company private, we’ve been trying to expand into both the broadcast and tele-communications areas,” Bennett says now. The costs of such an undertaking proved, quite simply, to be overwhelming. So Metromedia began concentrating on the research and marketing of so-called cellular (or wireless) telephone systems and mobile radio systems. This requires “an enormous amount of money,” Bennett says, and it’s such a risky, unproved business that banks are not willing to back it with mega-loans. To cover itself, Metromedia decided to unload its profitable, if largely mediocre, TV stations.
“I’m happy to have Channel 5 sold to the Hearst Corporation, people I have known for years,” Bennett said at Monday’s press conference. Others, of course, are less than pleased. After all, Channel 5 had been Boston’s only locally owned TV station for more than a decade, beginning back in 1972, when the local investors who’d founded BBI – including this very same Robert Bennett – were awarded the station’s broadcast license by the FCC. The Herald Traveler Corporation, which had previously owned Channel 5, lost the station’s license that year.
The FCC deliberations over Channel 5’s license took a full decade, and part of the ultimate decision to give the license to BBI had to do with a Herald Traveler Corporation executive by the name of Robert Choate, who’d made the fateful mistake of violating FCC rules by taking an FCC official to lunch – perhaps intending to influence the decision – during the proceedings. (Since the station was said to be worth $100 million, Sterling Quinlan’s 1974 book about the Channel 5 case was titled The Hundred Million Dollar Lunch.) At the time, however, BBI said it was awarded the Channel 5 license because of its “high degree of owner management and its freedom from other media connections.”