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Bermuda broadcasting spared by CBS cost-cutting proposals

Proposals by the CBS television network to charge affiliates fees to take certain programmes will apparently not affect its local subscriber, Bermuda Broadcasting Company.

Stung by rising expenses and increasing competition, particularly from the fledgling Fox network and cable television, CBS is trying to offset more of its costs.

CBS is planning to reduce the amount of compensation it pays affiliates to take its service.

Networks, which tend to follow each other when it comes to compensation plans, typically pay their affiliates to run their shows and advertising as a way of ensuring that advertisers achieve maximum exposure.

CBS last year cut its compensation to local stations from $150 million to $121 million.

Although it still plans to compensate affiliate stations, the new proposals call for affiliates to pay a charge to the network for some shows at a rate depending on size.

For the top 100 markets, for example, the charge would be 25 percent of the compensation. The bottom 200 stations would give back 15 percent.

In addition, CBS wants to graduate its payments to stations depending on a show's popularity. It will pay more for lower-rated shows and less for shows with higher ratings.

Some stations have complained but Bermuda Broadcasting's general manager Mr.

Malcolm Fletcher said Bermuda was too small to be included in the plan.

Mr. Fletcher, who has just returned from the CBS affiliates' annual general meeting in New York, where the plan was discussed, said: "None of the affiliates were particularly happy about it but, at this time, it's only a plan. I don't think it's a fait accompli.

"As I understand it, the proposals only affect stations in large markets, who receive compensation for taking non-local advertisements.

"Bermuda Broadcasting doesn't get any compensation because we're too small so it looks as if we won't be affected.'' Bermuda Broadcasting has been affiliated with CBS since 1959 and does not have to pay for the service. CBS stipulates that only 90 seconds of local advertising can be shown per hour.

Mr. Fletcher said there was nothing at the affiliates' AGM, which was attended by approximately 250 general managers, to indicate that Bermuda would have to pay anything to continue to receive CBS.

"All in all, there was nothing said at the meeting which would give us cause for alarm,'' he said.

Mr. Malcolm Fletcher.