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NBC brass to visit newest property
The Atlanta Journal-Constitution
Published on: 07/08/08
It's unlikely that NBC late-night talk show host Jay Leno will start making Weather Channel jokes during his monologue.
But now that NBC's parent has agreed to buy the Atlanta-based cable network, tropical storm expert Steve Lyons could show up on the "Today" show if a hurricane is threatening the United States. Or, viewers of NBC's 2008 Olympic coverage could learn whether a thunderstorm is threatening an upcoming 200-meter race from a report "brought to you by the Weather Channel."
The words "local" and "mobile" will be key, experts say.
NBC Universal agreed Sunday to buy the Weather Channel in a deal that is expected to close by the end of the year. Officials declined to reveal the selling price, but news reports say the network, Web site and other weather-related properties went for $3.5 billion.
NBC officials on Sunday said they are going to let the Weather Channel operate as a separate unit. Its new $60 million studio and 1,300 workers will stay here, and at this point there is no plan to change anything, they said.
NBC is 80 percent owned by General Electric. Vivendi, a media company based in Paris, owns the other 20 percent. NBC's cable investments include A&E, the History Channel, History Channel International and Biography Channel. NBC also owns other cable news operations, MSNBC and CNBC.
"I think rather than putting more NBC into the Weather Channel, they will put more Weather Channel into NBC," said Alan Breznick of Heavy Reading, a media research firm based in New York.
NBC Universal officials, including President and CEO Jeff Zucker, are scheduled to visit the Weather Channel today, a person familiar with the deal said.
GE executives have been under increased pressure to sell off NBC and its media units, especially after disappointing first-quarter results. The Weather Channel deal makes sense either way, experts said.
"You've just theoretically increased the value of the asset," said Aaron Cohen, a cable analyst with New York-based Horizon Media. "Then, how can they begin to maximize revenues through cross-collaboration with other stations and other properties?"
Cross-promotional opportunities are "a big part of this deal," Zucker told the Hollywood Reporter on Sunday. He gave examples of NBC taking advantage of placing Weather Channel-backed material on CNBC and MSNBC.
NBC has its own weather network, Weather Plus. The fate of that network, which was formed to compete with the Weather Channel by providing hyper-local weather information, is unclear.
The co-branding of NBC and the Weather Channel is likely to help both sides, Breznick said.
"The Weather Channel is pretty well known, but they can always make it better known. NBC can do a good job of blasting that out," he said.
That is where cellphones and other mobile devices can come into play. The Weather Channel already zaps text messages and severe-weather alerts to cellphones and other mobile devices. Now, they can come packaged with a video clip from NBC.
"That is one area that can have great value and can be something that is very valuable for local television statements," said Jim Goss, an analyst with Barrington Research in Chicago. "There are few things that you want to know right now, and weather is at the top of that list."
Goss said the "immediacy" factor has caught the attention of advertisers, who basically have a short opportunity to send a message before viewers flip to another TV station. Also, viewers are not prone to record such coverage and skip over the ads. These factors make the Weather Channel a premium site for ads, Goss said.
"That's always been the thing that any broadcaster or content distributor would go after," Goss said. "That's why the Olympics are very valuable. That's why sports are very valuable."
David Hazinski, head of the broadcast news program at the University of Georgia, said the Web site will play a major role in garnering advertising dollars as well.
"The Weather Channel has an extremely good Web presence, and we know there is a significant migration of Web dollars" away from traditional media, Hazinski said. "I think that has as much potential than the broadcast side does for NBC."
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