Home | Store

Scripps: Breaking Up is Hard to Do?
Friday, October 19, 2007 | posted by Mike

Well, not according to the press release issued by Food Network's parent company, Scripps:

The E. W. Scripps Company's board of directors has unanimously authorized management to pursue a plan to separate Scripps into two publicly traded companies, one focused on creating national lifestyle media brands and the other on building market- leading local media franchises.

The two companies that would exist after the separation would be:

  • Scripps Networks Interactive, which would consist of the national lifestyle media brands and associated enterprises that operate collectively as Scripps Networks, including television's HGTV, Food Network, DIY Network, the Fine Living Television Network and Great American Country and their category-leading Internet businesses. The new company also would include online comparison shopping services Shopzilla and uSwitch and their associated Web sites. These businesses have combined annual revenue of approximately $1.4 billion and 2,100 employees.

  • The E. W. Scripps Company, which would include daily and community newspapers in 17 U.S. markets; 10 broadcast television stations clustered among the nation's largest 50 markets, including six ABC affiliates, three NBC affiliates and one independent station; the character licensing and feature syndication businesses operated by United Media; and Scripps Media Center in Washington D.C., which includes the Scripps Howard News Service. These businesses have combined annual revenue of about $1.1 billion and employ about 7,100 people.

There was also the requisite disclaimer to let employees know that they don't need to start looking for opportunities elsewhere:

The proposed separation is not expected to have a material effect on the day-to-day lives of employees working at the company's television networks, newspapers, broadcast television stations, Internet search businesses, licensing and syndication subsidiary and other related businesses.

With the many items we've posted -- usually around earnings report time -- about Scripps' television holdings keeping things moving forward for the company, I suppose this isn't a huge shock. In case you haven't noticed, this isn't a good time to be in the newspaper business. There are a lot of reasons for this, most of which being Internet-related. Print advertising is down, local paper readership is dwindling and even reliable income like personals and classified ads are being lost to eBay, Craigslist and online dating services.

So that's the official word from the company, but what does it mean for the future of SNI and to you, the viewer? Here's an interesting bit of analysis from the Financial Times which states that this may not be the end of the drama:

The source said that the new structure, scheduled to be in place by the second quarter of 2008, will make it more feasible for a sale of some or all of the newspapers or television stations, consistent with the desires of some shareholders, particularly as to the newspapers.

One former television executive, now working for a website, said Scripps Networks Interactive may be bought by a company like Microsoft or Disney for its high growth media assets. The source said Scripps Networks Interactive will be much more attractive to a potential purchaser seeking to bolster its digital media platform if it did not have to purchase the entirety of the E.W. Scripps company as now constituted.

Obviously, this is where it could get interesting. As the piece points out, a company like Microsoft, Disney, NBC Universal or some other conglomerate wouldn't be looking to get into the ink and paper business again, but the networks and the online shopping sites could certainly be attractive.

What would something like that end up meaning to the on-screen product? It depends on the buyer. An existing television network may look to integrate some of the programming across its various outlets. Notice how there's no ABC Sports any more? It's all ESPN on ABC now. But with sports, you're talking about a much wider audience than those who may tune in for niche programming like food, home, garden, etc.

The one instance where I can remember a network trying to use a food show across outlets was Rocco's The Restaurant, which appeared on both NBC and Bravo. Eh. Of course, the same networks did have some success pulling Queer Eye in the other direction during its height of popularity, so there is always the possibility. But that wasn't just a niche program...it was a show that could have been pigeonholed but that defied stereotyping and became a cross-over hit.

Cross-promotions, some gentle re-branding and maybe a guest appearance by Alton Brown on My Name is Earl will probably be the extent of it, though, as the new owner will likely want to focus on the Food Network's already loyal viewership and rely on its strong demographic profile as a consistent advertising money-maker.

Although the buzzword "synergy" doesn't quite have the same heat it did ten years ago, taking advantage of the successes of the parts of a company is still a smart business move. Having the FN purchased by one of these big media companies would likely mean we'll see some of the effects -- both positive and negative -- of the further consolidation of media ownership.

BTW...You're talking to someone who studied public and mass communication in college, so don't get me started on media ownership consolidation. Jeez, if you think this post was long...



Hi, I'm Mike and I created TVFoodFan.com as a place where you can come to get the latest news and views about what’s going on in the world of culinary television.

Contact Us at: mike@tvfoodfan.com

Click on the box above to browse our selected products or search all of Amazon.com below to purchase from our store.