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Public TV head sure WQEX will sell

Friday, November 22, 2002

By Rob Owen, Post-Gazette TV Editor

Even though plans for Diane Sutter's Shooting Star Broadcasting to purchase WQEX have fallen through for the time being, WQED Multimedia President George Miles expressed confidence at yesterday's board meeting that a use for WQED's commercially licensed sister station will be found.

"We're headed in the right direction. Unfortunately, this is a slight stumbling block," Miles said. "Even after the articles [this week], I got three calls expressing interest in doing something with us with WQEX."

Miles wouldn't identify what companies expressed interest in WQEX or for what purpose. He said Sutter may still emerge as the buyer, adding he would have made the same decision as Sutter to avoid paying damages if funding weren't secured by the deal's closing.

Robin Flynn, a senior analyst at Kagan World Media in Carmel, Calif., said Sutter's inability to line up financing to buy WQEX comes as no surprise.

In the current economic environment, she said, private equity funding is more easily found for the purchase of radio stations than TV stations. Because of bad loans to the cable and telecommunications sectors, banks have also been "very cautious this year," she said.

It probably doesn't help that Pittsburgh has a full complement of network affiliates, including Pax TV's long-term agreement to be on AT&T Broadband's systems.

"That can diminish a station's value," Flynn said. "Usually there would be some sort of network affiliation driving a station deal."

The only national networks missing in Pittsburgh are Spanish-language channels, but Nielsen estimates the Hispanic population in the Pittsburgh market is only 0.6 percent of TV households, which would appear too small to support a broadcast station. That means a buyer would be purchasing WQEX as an independent station.

"To buy a station and plan to operate it from the get-go as an independent can be difficult these days," Flynn said. She attributes that to the most popular syndicated shows having long-term broadcast contracts.

"The most successful independent stations will be those with sports rights deals with a local team or teams," she said.

The most recent commercial station sales in Pittsburgh came two years ago, when Sinclair bought the WB affiliate WCWB for $16.8 million. Three years ago Viacom bought UPN affiliate WNPA for $39 million.

Flynn said the $20 million price for WQEX might be high, but not exorbitant.

Flynn suggested media corporations might wait until next year when the Federal Communications Commission is expected to further deregulate the broadcast industry, raising the cap on the percentage of stations one company can own.

Rob Owen can be reached at< ahref=mailto:rowen@post-gazette.com> rowen@post-gazette.com or 412-263-2582. Post questions or comments to www.post-gazette.com/tv under TV Forum.

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