KC business community alive with pleasure over Newport HQ

It would be the first TV group to headquarter here, though it doesn't own a station in Kansas City — yet.

The new CEO of one of the country's largest television station groups is sending a strong signal that he intends to make Kansas City his new home.

Sandy DiPasquale (pictured), a Wichita-based television executive, is an investor with Providence Equity Partners and will be running the 24-city chain of TV stations that is being sliced away from the behemoth Clear Channel Communications. The new venture, to be named Newport TV, will be the 14th-largest ownership group in the country, pending government approval of the $1.2 billion deal.

The stations reach about 12 percent of U.S. households, which would put Newport on a par with Hearst-Argyle Television, the owner of Kansas City's ABC affiliate KMBC-TV and CW affiliate KCWE-TV. In an interview, DiPasquale confirmed a report in Thursday's Wichita Eagle that he was “leaning in the direction of Kansas City” for his corporate offices, given the heavy amount of air travel he'll be doing as its CEO.

  “Wichita is a delightful town, but with the size of this company, it's just a lot more practical to be in Kansas City,” said DiPasquale.

  DiPasquale said he would hire a staff of about 20 employees at the Newport corporate office and was favoring locations in the Country Club Plaza, including the Plaza Colonnade and the newly-renovated space where Saks Fifth Avenue once was. A representative for Highwoods Properties, the landlord of both sites, did not return my calls.

  The Newport empire would extend from coast to coast and would include stations in large markets (San Francisco) and small (Fairbanks, Alaska), with a mix of network affiliations. The closest property would be in Wichita, where Clear Channel currently owns the Fox and MyNetworkTV affiliates. None of its stations would be in Kansas City, though that could change. DiPasquale confirmed that Providence is interested in adding to its portfolio and is bullish on the TV sector.

Asked about the chance to own WDAF-TV, one of nine Fox stations put on the auction block last week, DiPasquale said, “I would love that.”

  Newport would be the first-ever television chain headquartered in Kansas City, according to local historian Bill Ryan, emeritus professor at Rockhurst University. The reason becomes obvious when plotting the 24 markets on a map: 12 are located to the east of Kansas City and 12 are to the west. Nine of the 24 markets are reachable by nonstop flights from Kansas City International Airport.

  Robert Marcusse, president and CEO of the Kansas City Area Development Council said he had “several good conversations” with DiPasquale since the Eagle story appeared. “We look forward to an opportunity to help locate them in the Kansas City area,” Marcusse said.

  The sale to Providence is not contingent upon the much larger sale of other Clear Channel assets to another private investment group headed by Bain Capital Markets and Thomas H. Lee Partners. That $19.5 billion deal is still pending approval by Clear Channel's shareholders. DiPasquale is moving ahead because he expects federal approval by Oct. 1, “possibly sooner.”

  DiPasquale is a Buffalo, N.Y., native who has been in the television business for 27 years, all of them working for or managing TV stations. He has been based in Wichita since 1989, when an investor group bought the Kansas Broadcasting System, including its flagship station KWCH-TV, and put DiPasquale in charge.

  At a time when broadcast TV is facing unprecedented challenges from the Internet and cable TV, Newport's holdings appear to be well-positioned. Many of the stations are affiliated with major networks that offer leverage with cable operators, who must negotiate the rights to carry local broadcast signals.

 

“Like any buyer, you believe you can operate (these stations) better: increasing revenue, increasing audience, increasing cashflow. We believe we can do all those things,” said DiPasquale.

In particular, he said he wants to build local news and Internet operations at the stations in the Newport chain.

  In most of the cities it served, Clear Channel owned two stations and broadcast as many as four separate TV signals. It aggressively promoted multicasting by offering separate programs, such as the 24-hour NBC Weather Plus, on its digital channels. Last fall Clear Channel launched a service called Variety TV to supply multicast programming to seven of its markets. DiPasquale said the future of Variety TV is “to be determined.”

  DiPasquale has a long history of running TV stations. After KWCH was sold in 1994, he joined another venture, Sunrise Television Corp., based in Florida. Working out of Wichita, he oversaw operations at the six-station group until it was sold in 2002. He then teamed up with Providence to create BlueStone Television. BlueStone acquired network affiliates in eight cities before selling the group last December for $230 million to a New York investment group.

  DiPasquale broke into the television business in 1980 at WGR-TV, the NBC affiliate in Buffalo. At the time, WGR was owned by Taft Broadcasting of Cincinnati -- as was WDAF.

The Newport stations

Pending regulatory approval, the station group currently known as Clear Channel Television will become Newport TV later this year. The nation's 14th-largest TV station group is a diverse portfolio of 56 full-power and low-power digital and analog TV signals representing every major broadcast network in the following 24 markets (key network affiliations in parentheses). In most of its markets, Clear Channel owns two stations broadcasting as many as four separate TV signals.

Albany, N.Y. (Fox); Bakersfield, Calif. (NBC, CW); Binghamton, N.Y. (ABC, NBC); Cincinnati (CBS, CW); Elmira, N.Y. (NBC); Eugene, Ore. (NBC, CW); Fairbanks, Alaska (NBC); Fresno (CBS); Harrisburg, Pa. (CBS); Jacksonville (Fox, CBS); Little Rock (Fox, CW); Memphis (ABC, CW); Mobile (NBC); Monterey-Salinas, Calif. (Fox, CBS, CW); Rochester, N.Y. (ABC, CW); Salt Lake City (ABC); San Antonio (NBC); Santa Barbara, Calif. (CBS, Fox); San Francisco (independent); Seattle (independent); Syracuse, N.Y. (ABC); Tulsa (Fox); Watertown, N.Y. (ABC, CW); Wichita (Fox).

Locally operated, not locally owned

Newport TV is expected to be the first TV-station ownership group to locate its headquarters in Kansas City. Here are the local broadcast stations and locations of their central offices:

Hearst-Argyle Television (New York): KMBC, KCWE
Meredith Corp. (Des Moines): KCTV, KSMO
E.W. Scripps Co. (Cincinnati): KSHB, KMCI
Ion (Clearwater, FL): KPXE
Fox Television (Los Angeles): WDAF (Fox recently announced it was putting WDAF and eight other network stations up for sale)

KCPT is the only locally-owned TV station remaining in the market. The nonprofit Kansas City Public Television holds its license.

Comments

[Aaron]

By the way, I notice that in the print edition someone had written a caption saying he would be running "24 TV stations" at Newport. The caption writer had obviously not read my factbox (the one left out of the print version but included above), nor was familiar with the concept of duopoly or multicasting.

In fact, the Newport portfolio is a real grab bag of license types: full-power, low-power, digital and this new wacky license denoted by the suffix "-CA," for "Class A." Our local Univision station is a Class A station, too.

[Aaron]

Correction -- our Univision station *was* Class A. Now it's been upgraded to plain ole LP, along with yet another goofy suffix, "LD," which I assume stands for low-power digital:

http://www.fcc.gov/fcc-bin/tvq?call=KUKC

[Mark Jeffries]

In Chicago, WWME is a Class A--they program mostly classic TV as "MeTV" (their full-power sister station's pure indie WCIU, "The U"). Thanks to having their transmitter on the Sears Tower, they have a wider range than some Class As--they also have digital cable and DirecTV placement and transmit on one of WCIU's digital channels, along with co-owned low power foreign language station WFBT and an HD channel that only operates when WCIU televises Cubs, White Sox and Bulls games (the games that WGN's CW commitments keep them from airing).

MeTV has a pretty loyal audience, although I'm sure the classic TV purists are complaining about "Roseanne" airing at 5 p.m. weeknights. At least it isn't "Extreme Makeover: Home Edition."

[Aaron]

Nonsense - no one should complain about a 20-year-old program that still holds up airing on a "classic TV" station. That show was pure genius from the moment they put it on.

[Mark Jeffries]

But they do, particularly the black-and-white zealots who think that nothing good was on after the mid-60s. I bet MeTV gets those people writing angry E-mails--and I did see a message board angry last year that Weigel decided to split the runs of "Mad About You" (when Sony put it back in barter syndication) between WCIU and MeTV. Now granted, that show is somewhat more dubious in terms of "classic TV."

[Mark Roberts]

I'm confused ... I thought the upgrade path was from LP to "Class A", gaining the station some must-carry rights on cable and satellite systems and the ability to flash-cut over to digital service when the time comes. I had not heard of the "LD" class until now ... but the Commish does not explain this at all well on its web site.