Katrina could complicate sale of Emmis TV station: Undaunted, New Orleans WVUE begins to rebuild

September 19, 2005

WVUE-TV Channel 8 in New Orleans has no transmitter, no offices, little functional equipment and a skeleton staff. The station owned by Indianapolis-based Emmis Communications Corp. also has no paying advertisers and a depleted audience, thanks to Hurricane Katrina.

The devastation wrought by one of the nation's worst natural disasters puts plans to sell the station on hold as WVUE officials survey the millions of dollars in damage to their facilities and equipment and fight to get back on the air full time.

On Aug. 22, Emmis announced the sale of nine of its 16 television stations for $681 million, and industry analysts said Emmis is seeking to sell the other seven-including WVUE-as part of a strategy to shore up debt and boost profitability by focusing on radio and print properties.

"A temporary operational impairment to a single station shouldn't make a material difference in Emmis' bottom line," said Fred Moran, an analyst covering Emmis for the Stanford Group in Boca Raton, Fla. "But there are a lot of questions surrounding this situation, and suddenly the sale of that station becomes much more difficult. If they were selling the remaining stations as part of a package, it could get even more complicated."

Emmis is well-positioned to weather the storm.

"They're bleeding money at every turn in New Orleans," said Robert Papper, a Ball State University telecommunications professor and former broadcast executive. "Fortunately, you're talking about a company that is a good operator and has a lot of resources. In the grand scheme of things, Emmis will be able to handle this. The same can't be said for all the other media operators."

Located in Orleans Parish, one of the areas hardest hit by the storm, floodwaters almost reached the roofline of the WVUE studios.

Emmis officials said the station will rebuild, but they admit it won't be easy.

"The staff has almost nothing it needs to do their job and are scattered in hotels and rented houses," said Kim Montour, Emmis Television vice president of news, who has been on the ground in Louisiana and Alabama.

WVUE stayed on the air when Katrina roared ashore Aug. 29 with live news reports around the city. Located in the heart of hurricane country, WVUE had an emergency plan, but Emmis officials said they weren't prepared for the catastrophic flood that engulfed the city after the levee broke Aug. 30.

"We were still on the air when our people began heading for the hills," said Ray Schonback, Emmis vice president of TV operations.

At 10 p.m. Aug. 30, WVUE lost its transmitter and went dark. It took nearly two weeks to locate all 94 of the station's employees.

But shortly after Aug. 30, a skeleton crew gathered in Mobile, Ala., at Emmis' WALA-TV station. In borrowed space, WVUE began producing newscasts aired over the station's Web site.

WVUE plans to return with a full lineup Sept. 19-including national Fox and local broadcasts, but Emmis officials said the station won't be operating "as normal" until late October.

Beginning Sept. 9, WVUE programming was made available full time through streaming data delivered by the station's Web site, www.Fox8live.com, and in the greater New Orleans area via DirectTV satellite service. Through DirectTV, WVUE was even able to carry the New Orleans Saints' opening game victory Sept. 11.

Assembling the news team was the station's first priority. As soon as the station could get back on the air via DirectTV and later through a low-power hook-up Sept. 13, WVUE started airing a 15-minute news loop, updated every two hours. Even after WVUE resumes normal broadcasting, news updates will take the place of many ad spots.

The hurricane and its aftermath create an opportunity for stations to distinguish themselves through superior news coverage, said Tom Cochrun, news director for Indianapolis' WISH-TV Channel 8. According to Nielsen Media Research, WVUE is the second-most-popular TV news outlet in the four-station market.

Nielsen officials, though, said there will be no ratings in New Orleans for the foreseeable future, complicating advertising sales.

Undaunted, the WVUE sales staff began reassembling Sept. 12, and station officials reported getting calls from potential advertisers.

Floodwaters from Hurricane Katrina almost reached the roofline at WVUE-TV Channel 8 in New Orleans, a station owned by Emmis Communications Corp.
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