The ongoing saga of Tribune bankruptcy will have a big effect on the syndication business.
Tribune owes four major syndicators money: Warner Bros., NBC Universal, Disney-ABC, and Twentieth. As a result of the Chapter 11 filing (with Tribune restructuring debt), the studios aren’t going to see a dime of the cash anytime soon.
This puts some stress on the studios’ bottom line, which may force them to write-off the payments they were supposed to receive.
And if other broadcasting groups file for Chapter 11, they will likely ask for the same thing, according to experts close to the matter.
Tribune is a major buyer of syndicated fare for its’ 23 television stations, including WGN-TV in Chicago. Programming includes Two and A Half Men, Jerry Springer (though not on WGN), Who Wants To Be A Millionaire, Live with Regis & Kelly, Family Guy, and The Simpsons. One show it bought for its station group (CBS’ T.D. Jakes project) has now been put on hold and may not launch as planned.
Despite the filing, Tribune has plenty of cash on hand to help with operating expenses and to pay the bills. But it may not shop aggressively for first-run and off-network programming as in years past.
Of course, this isn’t the first time a station group filed for Chapter 11 bankruptcy, though Tribune may be the biggest. In 1986, Grant Broadcasting, owners of three TV stations (including WGBO-TV here) filed Chapter 11 after spending too much money on programming and not seeing any successful returns from them – particularly from WGBO, whose ratings were disastrous (WGBO’s average total-day share in 1988 was a 2.) The three stations later went into receivership, with creditors running the stations under the name Combined Broadcasting.
WGBO was sold to Univision in 1994 and flipped to Spanish-language programming, while Paramount (now CBS Corp.) bought the other two stations (WGBS-TV in Philadelphia, now WPSG and WBFS-TV in Miami) in 1995.
Though its unlikely Tribune will face the type of situation Grant Broadcasting did, it nonetheless make the studios quite nervous.