Sponsor (July-Dec 1952)

station ? Now that race to get new stations on air has started, here's a breakdown designed to show admen why time is priced high network source, film and live-studio originations. Based on these characteristics, a station's operating costs during the first year could swing anywhere from $140,000 to $1,099,100, with the latter figure being conservative. How terrain affects costs is illustrated by the tower costs figure which ranges from $29,000 to $185,000. The caliber of personnel used in technical and producing operations can swell salaries from $30,000 to $385,000. The lowest salary figure assumes the use of some inexperienced personnel. To many a broadcaster, used to dealing in radio's costs, these figures were dream shattering. Station operators who had turned a neat dollar in radio and hoped to do even better in TV approached the subject cautiously. An analysis of their market area, either by their own personnel or through independent consultants, discouraged a number of radio station owners who had hastily filed application for a CP. It should be noted that all costs given below are based upon today's prices for today's markets. After Peter Levin submitted his figures, SPONSOR turned them over to various industry authorities for checking, was assured that the estimates were valid. Advertisers and their agencies may be surprised at the figures given and may look at rate cards with less askance after digesting the information shown. Sponsors might use a rule of thumb suggested by NBC v. p. William Hedges, "Figuring TV costs isn't loo difficult. Merely take your radio ugures and multiply them by four: usuallyvou won't be far off." * * * TV station operating costs for one year (Figures in thousands) Small Station 17 ow High Average Station Large Station fl.ow High [.ow High Nan-personnel operating costs, including general maintenance and/or rent, studio and transmitter maintenance, power, and transportation.— $12.", $12 $24.0 $37.5 $55.0 $85.0 Salaries and wages of technical and production men, including (where applicable) chief or asst. engineers; technical director; program manager; audio, video, and transmitter operators; maintenance men; projectionists; artists; staff announcers; etc SO.l-fr 49.8 75.8* 116.0 255.0 385.3 Program costs, including materials, rentals, license and copyright fees, services, etc... 55.0 122.0 63.9 181.0 149.(1 274.0 Sales and administrative costs, including salaries of salesmen and administrative personnel. office supplies, etc.... 16.1* 24.8 24.9* 45. i 68.5 Executive salaries including (where applicable) general manager, commercial manager, and the optional drawing of salaries by officers not on full time 7.0* 9.0* 52.5 56*5 Promotion and advertising expenses 5.0 10.0 5.0 3U.ll Depreciation, computed at differential rates to include equipment, fixtures and building 15.6 35.1 44.1 61.1 Miscellaneous costs, including special supplies and services, insurance, research, extraordinary program costs, local ^Combined AM-TV operations. "kSome joint use of personnel in AM and TV. 11 AUGUST 1952 S3.', 102.5 60.0 108.8 anu staie taxes, etc 6.7 25.0 11.9 46.4 68.3 99.9 GRAND TOTAL 140.6 297.2 249.6 545.8 742.4 1.099.1 STATION CHARACTERISTICS Small station It is assumed that: proportions of programing are 50% network on a bonus basis, 50% film; station on the air 10 hours a day; "low" group would have 80% sponsorship; promotion and publicity will be handled by a station executive. Middle ground for small stations would be about $230,000 if operated in conjunction with an AM station. Deduct $5,000 to $10,000 if officers do not draw upon corporation, except for services rendered. In many cases, contingency fund can be reduced by 90%. Average station It is assumed that : proportions of programing are 50% network, 25% film, 25% live studio; station on the air 10 hours a day; "low" group would have 80% sponsorship; promotion and publicity will be handled by a station executive in "low" group: "high" group has a separate employee for promotion and publicity with added staff personnel in contingency fund. Middle ground for this group would be about $450,000. Deduct $5,000 to $25,000 if officers do not draw except for services. Contingency fund may be reduced as much as 90%. Under some circumstances, low operating costs can be shaved to about $220,000. Large station It is assumed that: proportions of programing are Yz network. % film and \ /$ live studio; station on the air 15 hours a day. Middle ground for this group: about $850,000. Under some circumstances, "low" operating costs can be shaved to about $600,000. They can also go above $1,200,000. Note that figures in this group correspond closely to published figures of WTMJ-TV and appropriate averages released bv FCC. 35