With microwave proceeds, Schwartz nonprofits offer to buy and revive pubTV channels

By Dru Sefton

Should preserving noncommercial television licenses be the top priority for public broadcasters, or should financially unstable public TV stations be sold, become unstaffed repeaters or allowed to die off to right-size an extensive system of stations?

Independent Public Media says: Save those licenses. And it’s volunteering to take over failing pubTV stations to do just that.

IPM, founded by John Schwartz, a public media activist in Colorado and founder of several stations, announced Oct. 5 that it would draw on a pot of some $40 million to save stations at risk of going dark or being sold to station operators outside of pubcasting.

“If we can show how it’s done with one station, we can raise money from other parties and do a much larger rescue effort,” said Schwartz, who helped start independent-minded pubTV stations WYBE in Philadelphia and KBDI in Denver as well as WYEP-FM in Pittsburgh.

“We have proposals out to a couple of stations, and we will participate in an auction of KCSM” in San Mateo, Calif., said Ken Devine, IPM’s chief operating officer and former v.p. of media operations of WNET in New York.

Devine refers to the expected auction of public TV station KCSM, which is losing the support of its licensee. San Mateo Community College District trustees voted in June to put the station up for sale.

Pubcasters expect interests such as religious broadcaster Daystar Television to bid aggressively for the San Mateo station. When an Orange County college district decided to sell KOCE in 2003, Daystar fought hard to snap it up. KOCE’s management retained control, and it has since become PBS’s main outlet in the Los Angeles market.

This year, Daystar purchased former PBS stations WMFE-TV in Orlando, Fla., and KWBU-TV in Waco, Texas. Eight years ago Daystar also bought noncom KERA’s second TV channel, KDTN, in Dallas.

“There are only so many channels for noncommercial television in the United States,” Schwartz said. “If those are lost, they will never come back.”

But that priority may be at odds with CPB’s ongoing efforts to right-size the public TV system, such as its Merger/Collaboration Planning & Implementation Assistance Program, and its decision to end funding single-station master controls.

CPB declined to comment on IPM’s announcement.

IPM’s money comes from Schwartz’s EBS Companies, five nonprofits nationwide he founded in 1983 that hold licenses for 11 educational microwave systems using what the FCC calls Educational Broadband Service (EBS) channels — once known as Instructional Television Fixed Service (ITFS).

An August 2006 wireless broadband lease agreement with telecom company Clearwire provided IPM’s $40 million. Other pubcasters with spare EBS channels have inked similar agreements with telecom giants for EBS spectrum. Vegas PBS, for instance, is getting $33 million for a 30-year contract with Sprint and Clearwire approved in 2008.

Schwartz hopes to offer distressed stations a new path forward — using IPM’s money to remake themselves into sustainable public media operations instead of collapsing financially and selling their licenses.

However, the station must achieve its turnaround by an agreed-upon date. If not, IPM gets the license. “It’s tough love,” Devine said.

No “Machiavellian scheme”

Devine stressed that IPM is not interested in becoming an owner of pubTV stations. “This is not some Machiavellian scheme to form a TV network,” he said. “That’s the last thing we want to do. We want to match up spectrum and licenses with people who are able to sustain the station and focus on its core public media mission.” If the station’s present management can’t figure out how to turn it around, “ideally we’d find other people in that market” to do so, he said. “But in the interim or absence of those kinds of organizations or individuals, we are prepared to operate a station to sustain it over the long haul until a model develops to keep it viable.”

IPM also is not looking to win licenses to sell the spectrum in a possible upcoming auction to clear bandwidth for mobile devices. “We have ruled out selling 100 percent of any particular license,” Devine said, although it could consider selling part of a station’s bitstream to finance other acquisitions.

The initiative will specifically target licensees operating multiple TV stations that are looking to reduce their number of channels; those unable to sustain TV operating deficits; dual licensees with successful operations in radio and deficits in TV; and institutions that no longer rely on TV because they have found more cost-effective tools for their educational missions.

IPM envisions big changes at distressed stations, such as bringing in programs that attract younger and more diverse viewers — a total rethink of public television. “At some point, we have to move away from Lawrence Welk and Britcoms,” Devine said. “I think part of the problem is that no one has figured out how to convince g.m.’s to do things in a different way.” That’s especially important if PBS’s core older audience dies off and is not replaced by new fans.

But is a program overhaul enough to turn a troubled public TV station around?

“It’s a tough world right now to run any kind of station — especially if you’re trying to break the mold,” said Dennis Haarsager, executive director of public TV’s Major Market Group.

Haarsager points to Philadelphia’s WYBE. Schwartz helped establish the maverick station in 1990 and served on its board until 2009. It has never belonged to PBS and is now branded as MiND: Media Independence, which aims to help members of the public produce their own community-oriented, short-form content for broadcast and the Web. Eclectic titles from one recent morning’s lineup included “Green Entrepreneurship: No Risk, No Reward,” “Brain Hook” (a documentary on an instrument used to remove brains during mummification in ancient Egypt), an animated short from StoryCorps and “Juggling With Kyle.”

Although WYBE has done some innovative things,” Haarsager said, “it hasn’t been rewarded with enough money to sustain itself. It’s perpetually struggling and heavily subsidized by CPB through its CSG.”

Schwartz said that WYBE “throughout its whole history has tried doing something very different. MiND TV is just the latest and boldest experiment.” A station doesn’t have to have a big budget to be considered a success, he added. “As a concept, it’s really, really interesting: viewer-supplied content,” he said. “I’m proud to have been associated with it.”

Working to combat “inaction”

Schwartz said he’s been preparing for six months to put IPM into action. “Inaction” by the public TV system allowed religious broadcasters to start buying up stations, he contends. He has supported several public media efforts with millions of dollars over the years. His stable of EBS licensees has given more than $10 million to Free Speech TV, a progressive nonprofit multimedia network based in Denver. In 2008 it spent about $500,000 to launch Mobile Citizen, which provides low-cost 4G mobile broadband service to educational and nonprofit organizations.

lthough that’s still losing money, Mobile Citizen should be self-sustaining within the next year or so, Schwartz said, and he anticipates it ultimately will become a revenue source.

Devine got involved in April, after Orlando’s WMFE announced its upcoming sale. “That lit my fuse — there was no warning,” Devine said. “They didn’t consult anyone. They just said, ‘We’re focusing on radio now, and goodbye.’”

IPM is still formulating its treatment plan for tottering stations. Many details are still undecided, and its work with stations will vary by market. Devine said two part-time researchers are currently combing through stations’ Internal Revenue Service statements and other financial records to identify those most at risk of distress sales. Any IPM aid to stations would be subject to approval of all five EBS boards — although Schwartz doesn’t see that as problematic, as he’s been doing that for years.

Washington, D.C., telecom attorney John Crigler said the FCC treats the transfer of control of a station the same as a sale, so IPM would have to show it is qualified to be a licensee.

Crigler said IPM has an interesting idea “and it recognizes the general truth that a lot of stations are in trouble.”

For example, KCSM-TV is running a $1.1 million deficit. Its licensee, the San Mateo Community College District, lost $20 million in state funding over the past three years and expects more cuts this year and next.

“For many years we’ve subsidized the station out of our general fund, which has now become impossible to do,” Richard Holober, president of the district’s board of trustees, told Current. “There’s no question the sale of KCSM is happening, and relatively soon. There have been folks who’ve said, ‘Let us try to save the station,’ but no one has come up with one penny.”

The IPM initiative “sounds like it could be different,” Holober said, adding that the board would be open to speaking with IPM.

Pubcasters are shy about commenting on IPM’s plans, which haven’t been spelled out fully. PBS told Current in a statement that it is “not in a position to comment specifically on Independent Public Media’s plans or goals since we do not have direct knowledge of them.”

PBS observed: “This is indeed a period of great change and challenge in public media. We welcome everyone who believes in our collective system to join the conversation about the way forward.”

EARLIER STORIES

Earlier version of this article, published online Oct. 6.

Often-idle ITFS microwave channels, held by many public TV stations, get their moment in the sun. They’re becoming the little channels that could (get used or leased)

Back in 1999, pubcasters, colleges and other nonprofits with licenses for ITFS (Instructional Television Fixed Service) video channels — now known as EBS (Educational Broadband Service) — faced complicated decisions about their close relationships with commercial “wireless cable” operators.

At school-system-owned Vegas PBS, made a deal to earn $33 million from leasing EBS channels to Clearwire and Sprint in 2008.

RELATED LINKS

Independent Public Media, a nonprofit consortium that hopes to save struggling public TV stations from being purchased by commercial entities.

What about the future of KCSM-TV in San Mateo, Calif.? The licensee of San Mateo’s KCSM-TV, San Mateo County Community College District, says it tried to reduce costs at the station and must end subsidy of the station. The college said in a statement on its website: “A $1,100,000 KCSM-TV deficit translates to approximately 120 course sections or 4,800 classroom seats. Sadly, we are confronted with making very difficult choices and we must give the highest priority to those activities that serve students in order to fulfill our primary mission.”

Questions, comments tips? sefton@current.org

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