Strike may affect local stations’ bottom lines

The current writer’s strike in Hollywood may further hurt TV stations’ bottom lines, which are already reeling from a soft ad market and tight spot ad inventory.

Stations, especially network affiliates, need fresh programming in the last hour of prime time to lead into their late local newscasts. With network programming likely to go into reruns the longer the strike progresses, ratings will decrease and may hurt stations’ late newscasts.

Local news makes up as much as 40 percent of a station’s revenues.

The strike might not hurt longtime news leaders who have loyal viewers (like WLS in Chicago or WSB in Atlanta), but may wind up hurting stations who are in last place in news and need the prime-time lead ins the most (WBBM in Chicago or KPRC in Houston.)

Moreover, stations in smaller markets (particularly below the top 50) are the most likely to be hit the hardest. Those stations still rely on the old diary system for ratings, where audience is measured only four times a year (November, February, May and July.) It may be hard to estimate the local ratings based on national numbers because of the strike and the constant fluctuation of network schedules.

With the economies reeling here in Illinois and in other states such as Michigan, stations in small markets in these places will be hit particularly hard.

updated at 10:47 am on 2007-11-10 to add link from Broadcasting & Cable (“Stations feel glut of reruns”).