KGMB - KHNL - KFVE "shared services agreement"

[Kalihiboy]

Re: KGMB - KHNL - KFVE "shared services agreement"

That's what I figured.

I wonder if they will keep the historic coconut tree that still growing out of the roof, or will that piece of KGMB's past be swept away?

Taking the old antenna down will be something sad to see, hopefully they won't have the same problems that KHON did when their antenna crashed onto parked cars with people inside them in 1980.

Aj

[foolish heart]

Re: KGMB - KHNL - KFVE "shared services agreement"

Taking the old antenna down will be something sad to see, hopefully they won't have the same problems that KHON did when their antenna crashed onto parked cars with people inside them in 1980.

Aj

Whoa! I don't remember this!

I must have been living on the mainland at the time.

[Kalihiboy]

Re: KGMB - KHNL - KFVE "shared services agreement"

Whoa! I don't remember this!

I must have been living on the mainland at the time.

If I remember right whomever brought the tower down didnt even have a contractors license. I believe that was Lynne Russell's last day at the station and she along with cameraman Harry Alama covered that story.

Aj

[foolish heart]

Re: KGMB - KHNL - KFVE "shared services agreement"

If I remember right whomever brought the tower down didnt even have a contractors license. I believe that was Lynne Russell's last day at the station and she along with cameraman Harry Alama covered that story.

Aj

Oh boy, thank goodness no one got hurt.

I imagine KGMB is gonna need one of those massive cranes for construction or something similar to bring that tower down piece by piece.

Probably gotta close that section of the street, behind the station too.

Dunno but it will be a very sad day indeed.

[Betamax]

Re: KGMB - KHNL - KFVE "shared services agreement"

The KHON tower top third dropped to the ground when the crane that was attempting to lift it off ..buckled. There was a worker who jumped to the bottom 2/3rd's who had intended to ride the top portion down to the parking lot. If the crane buckled the wrong way.. would've crushed the KHON studio.. instead it dropped into the next door parking lot crushing the back half of a car containing 2 folks in the front seat who were uninjured (luckily). Charlie Bolig was then contracted to take down the rest of the tower piece by piece. Funny thing is the new owners after that (Des Moines Register) didn't want the tower taken down as it was a valueable grandfathered structure.

betamax

[Frankie's Market]

Re: KGMB - KHNL - KFVE "shared services agreement"

Thanks, Media Guy, for helping Frankie and A.J. with the details they either choose to ignore, or simply unable to comprehend.

Who's the one "unable to comprehend?"

It's all about accounting!
In broadcasting, profit is a close relative called Broadcast Cash Flow (BCF). While the station had a positive BCF, if wasn't servicing its debt or return on investment, therefore wasn't profitable.

Your savior, Media Guy, says KGMB wasn't profitable. His words.

And my take on the KGMB/KHNL's news dept. consolidation? First of all, this is what I said, a full ten posts ahead of Media's Guy post.

Midweek's pair of KGMB alumni makes their views known on the merger.

Bob Jones, who bemoans the fact it is ad revenues (not journalistic standards) that sustains TV news departments.

And here's what I said 33 posts prior to that.

The layoffs and cutbacks that are occuring in both govt. and the private sector are unmistakeable signs of a shrinking economy. And why should it not affect the revenue that sustains the TV news departments? I feel sorry for those people who may be out of a job with this KGMB-KHNL/K5 consolidation,...... but TV news is, lest we forget, a business.

KGMB wasn't profitable for its owner. It wasn't raking in enough ad revenue. Ergo, the SSA scenario that the KGMB news dept. now faces in order to carry on its survival.

Get a grip, Tunnl. Focus on getting your comprehension right before questioning others.

[Frankie's Market]

Re: KGMB - KHNL - KFVE "shared services agreement"

Cec has been in ill health the past couple of years. So I don't think so.
You'd be surprise at the amount of liquid capital that is available locally. Until recently it's been in real estate.

It's one thing for the money to be out there. It's quite another thing to get its holders to invest it, particulary in an industry which has always been quite risky to begin with. But even more so now, where consolidation and streamlining has been the trend.

I brought up Cec, if only because his name and broadcast business (if not political) reputation still means something in this state. If you can think of locals better than Heftel who would be able to put together and inspire the confidence of "a hui" where kama'ainas are willing to risk their hard earned savings (as opposed to media barons, hedge fund managers, and any other swashbuckling types who are only too eager to play high-stakes Monopoly with other people's money), I really would like to hear some names you would suggest.

[foolish heart]

Re: KGMB - KHNL - KFVE "shared services agreement"

The KHON tower top third dropped to the ground when the crane that was attempting to lift it off ..buckled. There was a worker who jumped to the bottom 2/3rd's who had intended to ride the top portion down to the parking lot. If the crane buckled the wrong way.. would've crushed the KHON studio.. instead it dropped into the next door parking lot crushing the back half of a car containing 2 folks in the front seat who were uninjured (luckily). Charlie Bolig was then contracted to take down the rest of the tower piece by piece. Funny thing is the new owners after that (Des Moines Register) didn't want the tower taken down as it was a valueable grandfathered structure.

betamax

Wow that was a close one!

Thanks for sharing

[DaleP]

Re: KGMB - KHNL - KFVE "shared services agreement"

KGMB wasn't profitable for its owner. It wasn't raking in enough ad revenue. Ergo, the SSA scenario that the KGMB news dept. now faces in order to carry on its survival.

I don't begrudge any broadcaster making a good profit. The problem I have, however, is with the companies that bought broadcast properties at unrealistically high prices, hoping they could quickly sell them at even higher prices.

$40-million was a ridiculous price to pay for KGMB. Even with their $18-million write down, I don't think the value of the station today is close to $22-million. From what I have read, the average TV station transaction this year has been around $10-million.

And I don't believe the SSA is going to do anything to increase the value of KGMB.

[mel]

Re: KGMB - KHNL - KFVE "shared services agreement"

In a way it is a good thing the economy is in the toilet, especially if the Media Council wins its case and KGMB is not allowed to enter into the SSA. The current owner will probably put the station up for sale and hopefully no local entity will have enough cash to buy it.

The last local organization interested in buying KGMB was.... er... um.... OHA.

[Frankie's Market]

Re: KGMB - KHNL - KFVE "shared services agreement"

$40-million was a ridiculous price to pay for KGMB.

Hindsight makes everyone a financial guru.

[TuNnL]

Re: KGMB - KHNL - KFVE "shared services agreement"

Who's the one "unable to comprehend?"

Apparently you...

KGMB wasn't profitable for its owner. It wasn't raking in enough ad revenue. Ergo, the SSA scenario that the KGMB news dept. now faces in order to carry on its survival.

I don't begrudge any broadcaster making a good profit. The problem I have, however, is with the companies that bought broadcast properties at unrealistically high prices, hoping they could quickly sell them at even higher prices.

$40-million was a ridiculous price to pay for KGMB. Even with their $18-million write down, I don't think the value of the station today is close to $22-million. From what I have read, the average TV station transaction this year has been around $10-million.

Thanks, Dale. Once again, Frankie seems to be confusing two separate things. Post after post, I have said KGMB made a profit. Frankie’s exact words: ‘KGMB wasn’t profitable for its owner.’ As far as I’m concerned, if you make more money then spent (A-B = BCF) that’s the textbook definition of profit. And that’s exactly what occurred. The only people who f**ked up here is MCG Capital. They’re the naïve investors who paid $40 million to Emmis Communications for KGMB. If they had one iota of experience in the media business prior to making their purchase, they would have been able to forecast broadcast trends, such as the downward slope of ad revenue after an election year cycle that occurs regardless of whether the economy is good or bad. When Media Guy says the station wasn’t servicing its debt, we’re talking about MCG Capital’s debt, not KGMB’s. And yes, their problems were exacerbated by the financial crisis’ local economic effect, as Media Guy noted earlier. But again, Emmis showed no aloha for the men and women who make KGMB work. Particularly, the salespeople who kicked arse under bleak conditions. From my vantagepoint, it was take the money and run.

[Kalihiboy]

Re: KGMB - KHNL - KFVE "shared services agreement"

New guests slated for tonights "Insights on PBS Hawaii":

Wally Zimmermann, former TV news director at KHON and KITV; Garett Kamemoto, former TV journalist at KGMB and KHNL; Elisa Yadao, former TV journalist at KGMB and KHNL;and Chris Conybeare, Media Council Hawaii.

Blangiardi and Archer were to appear but their corporate lawyer nixed their appearence. Too bad because I thought it would have been great to hear the perspectives on both sides of the issue. Nonetheless, I think it will be a great show.

http://leslienotes.typepad.com/the_l...ost-died-.html

[Frankie's Market]

Re: KGMB - KHNL - KFVE "shared services agreement"

Apparently you...

Sez you.

Thanks, Dale. Once again, Frankie seems to be confusing two separate things. Post after post, I have said KGMB made a profit. Frankie’s exact words: ‘KGMB wasn’t profitable for its owner.’ As far as I’m concerned, if you make more money then spent (A-B = BCF) that’s the textbook definition of profit. And that’s exactly what occurred.

And as Media Guy points out and which you totally fail to understand, that positive BCF wasn't enough to service the debt or initial investment MCG Capital took in purchasing the station. Tunnl, that's Business 101! Nobody takes over a business like a TV station for FREE!!! Whether anyone starts up a business or takes over a business, the startup capital to get the enterprise going is most definitely a part of the investment picture. It's not money that drops out of heaven like manna, for goodness sakes! If that money was borrowed, then interest has to paid back on it. So whatever positive BCF was coming was being eroded by the debt servicing.

Your "textbook" definition of profit is woefully incomplete. There are high school students in the Junior Achievement program who know more than you do.

[Media Guy]

Re: KGMB - KHNL - KFVE "shared services agreement"

Actually, $40 million for KGMB wasn"t a bad deal.
At the time Emmis had been getting 10-13 times BCF for all its station. KGMB's BCF was around $3 million, so x 10 would have been $30 million. The fee simple property was appraised at between $12-$14 million, so MCG saw it as a good deal.
New Vision bought KHON a year later for almost twice that price.
Of course they are currently in bankruptcy, but it just shows what station valuation was like just a couple of years ago.

MCG bought into Greenlaw/Marshall's business plan, it made sense and Jeff Greenlaw had been a big executive with the Family Channel and MTV.

The problem was KGMB couldn't meet projections because of the downturn in advertising revenue because of the economic conditions, so it needed a cash infusion, which MCG didn't see as a viable option because of all the other financial hits the firm had taken with its other investments when the economy tanked.
Also, when the property was sold, KGMB had to pay about $40,000 a month in rent. That almost half a million dollars a year added to the station's operating expenses. Remember, KGMB didn't get to keep the $12 million from the sale.

Oh yeah, and moving to a new location would cost around $3.5 million, not including rent and leasing a new transmitter site.
All in all it was just a matter of bad timing for everyone involved. MCG comes out looking like the bad guy, but in reality they're just trying to recoup as much as they can from a bad investment. The SSA has a better ROI than selling KGMB at its current market value.

Anyway, there's the brief history of the financial mess that has taken us to this point.