Bonneville International Corp., a Mormon Church holding company, is selling KIRO-TV to a Dallas corporation for $160 million.
In anticipation of a decision by CBS television to end its 36-year relationship with KIRO, A.H. Belo Corp. of Dallas will run Channel 7 as an independent station with a strong news commitment, the two companies said today.
The sale and expected affiliation change represent a major shift for the nation's 12th-biggest TV market, where network affiliations have been stable for more than three decades.
Rodney Brady, president and chief executive officer, said the company decided to sell KIRO-TV because Bonneville lacked the clout, with only two TV stations, to compete in a world where chain ownership is supreme. Bonneville owns only one other TV station, CBS affiliate KSL-TV in Salt Lake City.
Belo, among many other firms, approached Bonneville in July, the values of the two companies meshed and the price for KIRO-TV was right, Brady said at a news conference today.
The affiliation uncertainty also was a factor and indicative of Bonneville's modest clout. CBS has not told KIRO what its fate is.
The network has been talking with Gaylord Entertainment Co., the owner of KSTW-TV (Channel 11), about becoming the CBS affiliate in the Puget Sound area. Such a change likely would mean that KSTW would gain viewers and expand its news department.
With KIRO's announcement today that it fully expects CBS will
leave Channel 7, another announcement could be imminent regarding CBS, Gaylord and Channel 11.
If and when CBS makes the switch to KSTW, KIRO would have to scramble to line up syndicated and local programming to replace an extensive network lineup.
Buyer has strong reputation
The good news for KIRO is that Belo brings a strong reputation for broadcast journalism at a time when KIRO-TV is trying to rebuild its No. 3-rated newscasts. Robert Decherd, Belo chairman, president and chief executive officer, called journalism "the fuel of our economic success."
Belo owns the Dallas Morning News, ABC affiliate WFAA-TV there and stations in Houston, New Orleans, Sacramento, Tulsa, Okla., and Norfolk, Va., all affiliated with either ABC or CBS.
"We believe the news presence of this television station is such we can build a successful independent station around that news product," Decherd said at the news conference. "We believe people in every market, viewers and readers, respond to distinguished journalism."
The sale of KIRO-TV, which includes Third Avenue Productions, a video-production firm, must be approved by the Federal Communications Commission, which will take about six months.
Bonneville will retain ownership of news-talk radio stations KIRO-AM (710) and KIRO-FM (100.7) and all-news KING-AM radio (1090), which it is buying from the Bullitt family. The Salt Lake City company owns 13 other radio stations around the country and will not sell KSL-TV, which is sacred to the Mormon Church, said Ken Hatch, KIRO's president and CEO.
Hatch and four other KIRO executives have two-year contracts with Belo, effective upon FCC approval of the ownership change.
Shake-up began in May
The Belo acquisition in Seattle and the anticipated CBS affiliation change come less than four months after upstart Fox stunned the industry by stealing affiliates from CBS, ABC and NBC in 12 markets. Fox won 10-year affiliation deals by investing in New World Communications Group, which owns a growing chain of TV stations.
In all, since that May shake-up, there have been network-affiliation changes announced in more than 27 cities.
Since most TV stations are under group ownership, changes in one city often affect other markets. Take Seattle, for example. The roots of change here are in Dallas.
CBS had already been stung by Fox's interception of its National Football League contract. Adding further injury to its stature, CBS was the hardest hit in the initial Fox raid of the Big Three henhouse, losing eight affiliates.
One of them was KDFW-TV in Dallas-Fort Worth, the No. 8 market.
Enter Nashville-based Gaylord, which owns the Grand Ole Opry, country-music cable channel The Nashville Network and four TV stations, including independent KTVT-TV in Dallas. Neither side has confirmed reports of CBS-Gaylord talks, but industry leaders have been planning accordingly.
In considering signing its Dallas station with CBS, Gaylord no doubt has also sought a lucrative and prestigious network affiliation for Tacoma-based Channel 11, unaffiliated for 32 years.
Hurdles in way of CBS deal
Any CBS-Gaylord deal would have to overcome roadblocks.
Gaylord had planned to affiliate its Seattle and Dallas stations with Time Warner-owned WB Television Network, planned for launch in January. But with the prospect of affiliating with CBS, one of the Big Three, Gaylord changed its mind about WB. Gaylord and Time Warner Inc. have sued each other over the matter.
Now it's KIRO that could be looking at some point to WB for affiliation, or another planned upstart network, Paramount, although Belo says it won't actively seek affiliation. Said Ward Huey, president of Belo's broadcast division: "We see the opportunity to be a large independent television stations as very exciting."
KIRO general manager Glenn Wright, who will stay at the station under Belo, said independent status can actually be more profitable than network affiliation because the station controls all of the commercial availabilities.
Ironically, KSTW, then known as KTNT-TV when it was owned by the Tacoma News Tribune newspaper, was an early affiliate of CBS, from its sign-on in 1953 until 1958, before KIRO-TV even existed.
When KIRO signed on, CBS dropped KTNT and picked up KIRO. But KTNT sued and won its CBS affiliation back. So from 1960 until 1962, Seattle-Tacoma had two CBS affiliates.
Queen City Broadcasting Co., which owned KIRO-AM radio (710), launched Seattle's fifth television station in 1958. The company's president, Saul Haas, sold controlling interest of KIRO-TV, KIRO-AM and KIRO-FM to the Mormon Church in 1964.